Definition:
Herfindahl-Hirschman Index (HHI)
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The Herfindahl-Hirschman Index is a measure used by the U.S. Justice Department to determine market concentration.The Herfindahl-Hirschman Index number is determined by squaring the value of each company's market share and summing them.
An HHI index below 0.01 (or 100) indicates a highly competitive index.
An HHI index below 0.1 (or 1,000) indicates an un-concentrated index.
An HHI index between 0.1 to 0.18 (or 1,000 to 1,800) indicates moderate concentration.
An HHI index above 0.18 (above 1,800) indicates high concentration.
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