Question
There are 9 firms in an industry. Firm 1 and 2 each have a 15% share and the other 7 firms each have a 10%
There are 9 firms in an industry. Firm 1 and 2 each have a 15% share and the other 7 firms each have a 10% share. Firms 1 and 2 decide to merge.
HHI Concentration Level and Possible Government Action
Post-Merger HHIConcentrationChange in HHIGovernment Action
Less than 1000Not concentratedAny amountNo action
Between 1000 and 1800Moderately concentrated100 or morePossible challenge
More than 1800Highly concentrated50 or moreChallenge
i.Calculate the pre-merger and post-merger Herfindahl-Hirschman Index (HHI).
ii.Use the table below to evaluate the likelihood of an antitrust challenge.
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