This project aims to empower policymakers, regulators and economists with the tools to make data-driven, informed decisions that foster fair competition and enhance market transparency. By providing accessible, intuitive calculators, we aim to democratize competition analysis, making it easy for anyone to measure key economic indicators and understand market dynamics..
- Introduction
- Calculators
- Price-Cost Margin (PCM)
- Lerner Index
- Profit Margin
- Herfindahl-Hirschman Index (HHI)
- Return on Assets (ROA)
- Return on Equity (ROE)
- Cross-Price Elasticity of Demand
- Economic Value Added (EVA)
- SSNIP (Small but Significant Non-Transitory Increase in Price)
- Damage and Penalty Calculations (Overcharges and Pass-Through Rate)
- Net Present Value (NPV) of Damages
- Welfare Loss (Deadweight Loss)
- Critical Loss Analysis
- Residual Demand Elasticity
- Profit Impact of Market Power (PIMP)
- How to Use
- Installation
- License
The Competition Economics Calculator is a versatile tool designed to assist in analyzing various economic and financial metrics critical for assessing market dynamics, competition levels, and firm performance. Each calculator is user-friendly, allowing for clear input of data and providing immediate results and explanations.
The PCM measures a firm's ability to set prices above marginal cost, reflecting its market power.
Where:
- ( P ) is the Price.
- ( MC ) is the Marginal Cost.
- Input the Price (P) of the product or service.
- Input the Marginal Cost (MC) for producing one additional unit.
- Click Calculate to get the PCM result.
The Lerner Index quantifies a firm's monopoly power by comparing price and marginal cost.
- Input the Price (P).
- Input the Marginal Cost (MC).
- Click Calculate to determine the Lerner Index.
The Profit Margin measures how much of a company’s revenue translates into profit.
- Input the Net Profit.
- Input the Total Revenue.
- Click Calculate to get the Profit Margin.
HHI measures market concentration, indicating the level of competition within a market.
- Enter the market shares of all firms.
- Click Calculate to find the HHI result.
ROA indicates how efficiently a company uses its assets to generate profit.
- Input the Net Income.
- Input the Total Assets.
- Click Calculate to find the ROA.
ROE measures a company’s profitability relative to shareholders’ equity.
- Input the Net Income.
- Input the Shareholders' Equity.
- Click Calculate to find the ROE.
This metric measures how the demand for one good responds to the price change of another.
- Input the Change in Quantity of Good X.
- Input the Quantity of Good X.
- Input the Change in Price of Good Y.
- Input the Price of Good Y.
- Click Calculate to determine the Cross-Price Elasticity.
EVA measures the value a company generates from funds invested in it, after accounting for the cost of capital.
- Input the Net Operating Profit After Taxes (NOPAT).
- Input the Capital Invested.
- Input the Weighted Average Cost of Capital (WACC).
- Click Calculate to find the EVA.
The SSNIP test assesses whether a small but significant increase in price would be profitable in a particular market.
- Input the Price.
- Input the Marginal Cost.
- Input the Price Elasticity of Demand.
- Click Calculate to determine if a price increase is profitable.
This calculation assesses damages due to anti-competitive behavior.
- Input the Cartel Price.
- Input the Competitive Price.
- Input the Penalty Rate.
- Click Calculate to determine the Overcharge and Penalty.
NPV calculates the present value of future cash flows or damages, considering the discount rate.
- Input the Future Cash Flow.
- Input the Discount Rate.
- Input the Time Period (in years).
- Click Calculate to find the NPV of Damages.
Welfare loss measures the economic inefficiency resulting from anti-competitive behavior.
- Input the Change in Price.
- Input the Change in Quantity.
- Click Calculate to determine the Welfare Loss.
Critical loss analysis determines how much sales volume a firm can lose before a price increase becomes unprofitable.
- Input the Price.
- Input the Marginal Cost.
- Click Calculate to determine the Critical Loss.
Residual demand elasticity measures how much demand remains after competitors raise prices.
Where:
- ( \eta_{market} ) is the market elasticity.
- ( S ) is the firm's market share.
- Input the Market Elasticity.
- Input the Firm's Market Share.
- Click Calculate to find the Residual Demand Elasticity.
PIMP measures the increase in profitability due to market power.
- Input the Price.
- Input the Marginal Cost.
- Click Calculate to find the PIMP.
- Open the web-based Competition Economics Calculator.
- Select the desired calculator based on your analysis needs.
- Enter the relevant data as inputs for the chosen calculator.
- Click the Calculate button to get the result and interpretation.
To use the calculator locally, download the HTML file and open it in any modern web browser.
This project is licensed under the MIT License - see the LICENSE file for details.