Monopoly MOAT Research Desk RD / HHI

Market structure scanner

Market Concentration / HHI Calculator

Enter a complete market, combine two firms, and compare HHI before and after using the current US DOJ/FTC concentration thresholds.

Use the instrument Create a downloadable result

By Monopoly MOAT Research Desk · Methodology v1.0 · Tool reviewed August 29, 2026 · Source dates shown below

ONE-SENTENCE ANSWER

HHI adds every firm's squared market share, so large participants count disproportionately.

A five-firm market with shares of 30%, 25%, 20%, 15%, and 10% has an HHI of 2,250. Combining the first two firms raises the modeled HHI to 3,750—a 1,500-point increase. That is a structural screen, not a legal conclusion.

Method: DOJ HHI explainer · thresholds: 2023 Merger Guidelines, Guideline 1

MARKET SHARE TABLE

Build the whole market before you combine two firms.

Use one product definition, geography, measurement basis, and observation period. Enter separately identified participants; do not compress several competitors into one “Other” row.

Participant Market share%

Modeled combination First firm Second firm

The after scenario combines these two shares. Every other share stays unchanged.

I used one consistent product, geography, basis, and period, and entered known participants separately. I understand that 100% coverage is required for the guideline screens and that HHI does not decide whether a transaction is lawful.

Shares currently total 100.00%.

FORMULA

Square first. Then add.

HHI= Σ s_i²

two-firm ΔHHI= 2ab

Below 1,000. Below the moderate-concentration range described in the current US guidance.

1,000–1,800. Moderately concentrated. Exactly 1,800 does not satisfy a strict “greater than 1,800” screen.

Above 1,800. Highly concentrated. A change must also exceed 100 points for the HHI structural screen shown here.

Not a verdict. The agencies describe the guidelines as a non-binding framework; market definition and the underlying evidence still control the usefulness of the number.

WORKED EXAMPLES

Two calculations you can audit by hand.

DOJ EXAMPLE

30 · 30 · 20 · 20

30² + 30² + 20² + 20² = 2,600. The DOJ uses this example to show how larger shares receive disproportionate weight.

HYPOTHETICAL COMBINATION

30 + 25

A 30/25/20/15/10 market starts at 2,250. Combining 30 and 25 produces 3,750; ΔHHI is 2 × 30 × 25 = 1,500.

EVIDENCE BOUNDARY

No unsourced “real industry” presets.

This first release uses an official arithmetic example and a clearly hypothetical combination. A real market preset needs a defensible product and geography, dated shares that cover the full market, a consistent measurement basis, and publication rights. Marketstack supplies security prices, not product-market shares.

PLAIN-ENGLISH ANSWERS

Questions this instrument should settle.

What is the Herfindahl-Hirschman Index?

HHI is a market-concentration measure calculated by squaring every participant's percentage market share and adding the results. It ranges from close to zero in a market with many tiny participants to 10,000 for a single-firm market.

What HHI is considered highly concentrated in the United States?

The 2023 US Merger Guidelines describe a market with HHI greater than 1,800 as highly concentrated and a change greater than 100 points as significant. Those numbers are screening indicators, not a finding that conduct or a transaction is unlawful.

Why must the market shares add to 100%?

A partial market can materially understate HHI. This calculator shows arithmetic for incomplete inputs but withholds guideline screens until both scenarios account for 100% of the market within a small rounding tolerance. It never silently normalizes missing competitors.

Should I enter all small competitors as one Other row?

No. Squaring one combined Other share usually overstates the contribution of those competitors. Enter separately identified firms separately. If the tail cannot be resolved, label the market incomplete rather than inventing a split.

Does a high HHI prove a monopoly or an illegal merger?

No. The relevant product and geographic market, the reliability and timing of shares, direct competitive evidence, entry, efficiencies, and other facts matter. This tool reproduces a structural screen; it does not provide a legal conclusion or investment recommendation.

SOURCE DOCKET

Trace every material claim.

Each date belongs to its own source. Absence, unknowns, and derived calculations are labelled rather than silently filled.

01Herfindahl-Hirschman Index explainerUS Department of Justice · updated Jan 17, 2024
022023 Merger Guidelines, Guideline 1US DOJ and Federal Trade Commission · Dec 18, 2023
03Market definitionUS Department of Justice · 2023 Merger Guidelines
04Market sharesUS Department of Justice · 2023 Merger Guidelines