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Article: Philippine Domestic Shipping Transport Industry: State of Competition and Market Structure: Market Structure and Competition
- Article from:
- Research Paper Series (Philippine Institute for Development Studies)
- Article date:
- April 1, 2003
- Author:
CopyrightCopyright Philippine Institute for Development Studies 2003. Provided by ProQuest LLC. (Hide copyright information)
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The Herfindahl-Hirschman Index (HHI) is used as an indicator of market structure. The index is measured as the sum of the squares of the market shares. It is compared with the ratio 1/n where n is the number of operators in the industry. The higher the index relative to 1/n, the less competitive the industry is. The inverse of the index gives the number of equal sized competitors that would provide a degree of competition equivalent to that actually observed in the market share data. Hence, it is used as a measure of the number of effective competitors.
The aggregate indicator of market structure for the industry is based on the primary and secondary routes only, i.e. tertiary routes were ...