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Which is a measure is more accurate measurement of market concentration, the concentration ratio or the HHI? Why? Group of answer choices The concentration provides
Which is a measure is more accurate measurement of market concentration, the concentration ratio or the HHI? Why? Group of answer choices The concentration provides a better measurement of overall market concentration. This is due to the fact that the concentration ratio weighs individual market shares more heavily than the HHI. For instance two different markets can have exactly the same concentration ratio, but wildly different HHIs due to the way the concentration weighs individual market shares. The concentration ratio provides a more accurate measurement of market concentration due to the fact that it includes a greater number of firms in its calculation. The HHI provides a better measurement of overall market concentration. This is due to the fact that the HHI weighs individual market shares more heavily than the concentration ratio. For instance two different markets can have exactly the same concentration ratio, but wildly different HHIs due to the way the HHI weighs individual market shares. Neither of the two measurements of concentration provide a more accurate measurement of market concentration
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