Herfindahl Index


The Herfindahl Index is a market concentration metric derived by adding the squares of the individual market shares of all the players in a market.

As a sum of squares, this index tends to rise in markets dominated by large players.[1]




  1. ^ Farris, Paul W.; Neil T. Bendle; Phillip E. Pfeifer; and David J. Reibstein (2010). Marketing Metrics: The Definitive Guide to Measuring Marketing Performance (Second Edition). Upper Saddle River, New Jersey: Pearson Education, Inc.

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