Question 34 The ranking of industries by the four-firm concentration ratio usually, but not always, reveals the same pattern as ranking by HHI. When a discrepancy is found it is usually due to the following:

Question 34
The ranking of industries by the four-firm concentration ratio usually, but not always, reveals the same pattern as ranking by HHI. When a discrepancy is found it is usually due to the following:
The four-firm concentration index contains data on only the largest four firms, while the HHI is based on data for all firms in the industry
The HHI is based on squared market shares, while the four-firm concentration ratio is not
The four-firm concentration index contains data on only the largest four firms, while the HHI is based on data for all firms in the industry and the HHI is based on squared market shares, while the four-firm concentration ratio is not.
The two indices are designed to measure two different attributes of markets

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