What is the Herfindahl-Hirschman Index?
The Herfindahl-Hirschman Index (HHI) is a widely used measure of market concentration, calculated by squaring the market share of each firm in an industry and summing the results.
The formula
HHI = Σ (Market Share of Firm)², using whole-number percentages (e.g. 40 for 40%). U.S. antitrust guidelines generally treat an HHI below 1,500 as unconcentrated, 1,500–2,500 as moderately concentrated, and above 2,500 as highly concentrated.
For an accurate score, the market shares entered should sum to 100%. This tool is for general economic education, not a substitute for formal antitrust analysis.
Last reviewed August 2026