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Simulation of a Hirschman–Herfindahl index without complete market share information

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  • Eric Nauenberg
  • Mahdi Alkhamisi
  • Yuri Andrijuk

Abstract

This paper utilizes maximum likelihood methods to simulate a Hirschman–Herfindahl index (HHI) for markets in which complete market share information is unavailable or delayed. Many jurisdictions either may be unable to administratively collect data or experience delays in collection that make data regarding turbulent markets of limited use. With the development of this method, regulatory authorities monitoring health‐care competition or health‐care firms can now use market surveys – in which reliable recall is often limited to the largest three or four firms – to produce an on‐the‐spot measure of market concentration. Copyright © 2003 John Wiley & Sons, Ltd.

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  • Eric Nauenberg & Mahdi Alkhamisi & Yuri Andrijuk, 2004. "Simulation of a Hirschman–Herfindahl index without complete market share information," Health Economics, John Wiley & Sons, Ltd., vol. 13(1), pages 87-94, January.
    • Handle: RePEc:wly:hlthec:v:13:y:2004:i:1:p:87-94
    DOI: 10.1002/hec.814
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    References listed on IDEAS

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    1. Keeler, Emmett B. & Melnick, Glenn & Zwanziger, Jack, 1999. "The changing effects of competition on non-profit and for-profit hospital pricing behavior," Journal of Health Economics, Elsevier, vol. 18(1), pages 69-86, January.
    2. Eric Nauenberg & Yuri Andrijuk & Matthew Eisinger, 2001. "Reconsideration of discharge data to measure competition in the hospital industry," Health Economics, John Wiley & Sons, Ltd., vol. 10(3), pages 271-276, April.
    3. Stanley, Michael H. R. & Buldyrev, Sergey V. & Havlin, Shlomo & Mantegna, Rosario N. & Salinger, Michael A. & Eugene Stanley, H., 1995. "Zipf plots and the size distribution of firms," Economics Letters, Elsevier, vol. 49(4), pages 453-457, October.
    4. Eric Nauenberg & Kisalaya Basu & Harish Chand, 1997. "Hirschman-Herfindahl index determination under incomplete information," Applied Economics Letters, Taylor & Francis Journals, vol. 4(10), pages 639-642.
    5. Zwanziger, Jack & Melnick, Glenn A., 1988. "The effects of hospital competition and the Medicare PPS program on hospital cost behavior in California," Journal of Health Economics, Elsevier, vol. 7(4), pages 301-320, December.
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    Cited by:

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    2. Bai, Chong-En & Mao, Jie & Zhang, Qiong, 2014. "Measuring market concentration in China: the problem with using censored data and its rectification," China Economic Review, Elsevier, vol. 30(C), pages 432-447.
    3. Maurizio Naldi & Marta Flamini, 2018. "Dynamics of the Hirschman–Herfindahl Index under New Market Entries," Economic Papers, The Economic Society of Australia, vol. 37(3), pages 344-362, September.
    4. Maurizio Naldi & Marta Flamini, 2017. "Censoring and Distortion in the Hirschman–Herfindahl Index Computation," Economic Papers, The Economic Society of Australia, vol. 36(4), pages 401-415, December.
    5. Wu, Gang & Liu, Lan-Cui & Wei, Yi-Ming, 2009. "Comparison of China's oil import risk: Results based on portfolio theory and a diversification index approach," Energy Policy, Elsevier, vol. 37(9), pages 3557-3565, September.
    6. Domínguez Jurado, José Miguel & Triguero-Ruiz, Francisco & Avila-Cano, Antonio, 2021. "Firm growth in the 21st century: Does the Andalusian economy comply with Gibrat’s Law?," Physica A: Statistical Mechanics and its Applications, Elsevier, vol. 577(C).
    7. Keil, Jan, 2017. "The trouble with approximating industry concentration from Compustat," Journal of Corporate Finance, Elsevier, vol. 45(C), pages 467-479.
    8. Edward P. Swanson & Christopher J. Wolfe & Asghar Zardkoohi, 2007. "Concentration in Publishing at Top†Tier Business Journals: Evidence and Potential Explanations," Contemporary Accounting Research, John Wiley & Sons, vol. 24(4), pages 1255-1289, December.
    9. Sato, Masahiro & Kharrazi, Ali & Nakayama, Hirofumi & Kraines, Steven & Yarime, Masaru, 2017. "Quantifying the supplier-portfolio diversity of embodied energy: Strategic implications for strengthening energy resilience," Energy Policy, Elsevier, vol. 105(C), pages 41-52.

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