MEASURING SUPPLY CONCENTRATION ON THE SERBIAN OIL AND OIL DERIVATES MARKET BY HERFINDAHL-HIRSCHMAN INDEX

Abstract

One aspect of the intensity of competition analysis of the national oil market is the measurement of the concentration of supply, to which this paper is dedicated. That is why it is not surprising that there are different interpretations of these economic categories. The analysis of these phenomena dates back to the emergence of production relations and production forces. The relaxation of regulatory measures on the national oil market has opened the space for building quality competitive relationships between the participants. Market opportunities, conditions and competition in practice are determined by concentration in the certain observed market. Competitive relations between market participants change over time. Those changes impact on concentration level of certain and well defined market, in this case the oil market of the Republic of Serbia. As the competition changes, the concentration level changes as well. This is the reason why this paper is focused on concentration level measurement and analysis. In  measuring and expressing the concentration level of the certain market, many concentration indicators could be applied. Our choice was Herfindahl-Hirschman Index.