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A Buyer-Based Measure of Seller Concentration

Author

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  • Iwan Bos

    (Department of Organisation, Strategy and Entrepreneurship, Maastricht University, 6211 LK Maastricht, The Netherlands)

Abstract

In most markets, buyers differ in their ability or willingness to switch supplier. This note proposes a novel industry concentration measure that takes this heterogeneity into account. The index increases in the share of captive sales, coincides with the Hirschman–Herfindahl Index when none of the buyers are captive, and takes the “pure monopoly” value of 1 when all are captive.

Suggested Citation

  • Iwan Bos, 2022. "A Buyer-Based Measure of Seller Concentration," Mathematics, MDPI, vol. 10(14), pages 1-6, July.
    • Handle: RePEc:gam:jmathe:v:10:y:2022:i:14:p:2474-:d:864041
    as

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    References listed on IDEAS

    as
    1. Jan Boone, 2008. "A New Way to Measure Competition," Economic Journal, Royal Economic Society, vol. 118(531), pages 1245-1261, August.
    2. Jan Boone, 2008. "A New Way to Measure Competition," Economic Journal, Royal Economic Society, vol. 118(531), pages 1245-1261, August.
    3. Leslie Hannah & J. A. Kay, 1977. "Concentration in Modern Industry," Palgrave Macmillan Books, Palgrave Macmillan, number 978-1-349-02773-6, September.
    4. Davies, Stephen W, 1979. "Choosing between Concentration Indices: The Iso-Concentration Curve," Economica, London School of Economics and Political Science, vol. 46(181), pages 67-75, February.
    Full references (including those not matched with items on IDEAS)

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