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Revisiting Kelly's version of the Herfindahl-Hirschman index

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  • George G. Djolov

Abstract

This communication looks at Kelly's proposed formulation of the Herfindahl-Hirschman index (HHI), which has received some attention in the economic and management fields as a promising method to improve the measurement of market concentration by supposedly taking the skewness of market shares into account in the course of the index's computation. It is found that this is not the case, and suggestions are made as to how the formulation could be aligned to its intended aim as originally proposed.

Suggested Citation

  • George G. Djolov, 2018. "Revisiting Kelly's version of the Herfindahl-Hirschman index," International Journal of Computational Economics and Econometrics, Inderscience Enterprises Ltd, vol. 8(2), pages 170-182.
    • Handle: RePEc:ids:ijcome:v:8:y:2018:i:2:p:170-182
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