Can any one tell me how to use the HHI index to compute concentration index for entities located in different islands . My panel consists of 37 credit unions but located in different market/ island countries in the caribbean. The MSc thesis focuses on the determinants of performance of 37 credit unions in the Eastern Caribbean for the period 2009 to 2018 which consist of 7 island in the grouping. Each island is a market where the credit union is located. can the hhi index be computed based on island market for credit union in that market or can the hhi be computed for the subregion taking the whole seven islands in region as the entire market. Please see below the a sample of the data with the list of credit unions in the different islands. I am uncertain about this.
I want to add HHI as an explanatory variable since my data is not a normal distribution since the sector is highly concentrated as 6 credit unions control nearly 50% of total assets of the subregion. There are also problems with heterocedascity , autocorrelation and cross sectional dependence hence I plan to use robust panel estimation like PCSE to assist.
Please see below my current model:
ROAit= β0 + β1CATETAit+ β2LOGSIZETAit+ β3LIQLNDit+ +β4LEVTLTAit+ β5MENIETAit+ β6MENIETI+ β7MESCNIE it+ β8NIMTA +β9 AQLNTA it + β10GDPGit +εit Where:
ROAit= log of return on asset for entity i in year t
CATETAit= log of Capital adequacy for entity i in year t
LOGSIZETAit= log of Total assets used as a proxy for size for entity i in year t
LIQLNDit = Total loan/deposits as proxy for Liquidity for entity i in year t
LEVTLTAit = Total liabilities/ Total assets as proxy for Leverage for entity i in year t
MENIETAit = Non- interest expense/ total assets as proxy for Management efficiency for entity i in year t
MENIETIit = Non- interest expense/ total income as proxy for Management efficiency for entity i in year
MESCNIEit= staff expense/ total non interest expense as proxy for Management efficiency for entity i in year
NIMTA= Net interest income / Total assets as proxy for efficiency in earnings ability
AQLNTA= total loans/ total assets as proxy for Asset quality for entity I in year t
GDPit== real GDP growth for entity i in year t
see sample total income of credit union in two islands
I want to add HHI as an explanatory variable since my data is not a normal distribution since the sector is highly concentrated as 6 credit unions control nearly 50% of total assets of the subregion. There are also problems with heterocedascity , autocorrelation and cross sectional dependence hence I plan to use robust panel estimation like PCSE to assist.
Please see below my current model:
ROAit= β0 + β1CATETAit+ β2LOGSIZETAit+ β3LIQLNDit+ +β4LEVTLTAit+ β5MENIETAit+ β6MENIETI+ β7MESCNIE it+ β8NIMTA +β9 AQLNTA it + β10GDPGit +εit Where:
ROAit= log of return on asset for entity i in year t
CATETAit= log of Capital adequacy for entity i in year t
LOGSIZETAit= log of Total assets used as a proxy for size for entity i in year t
LIQLNDit = Total loan/deposits as proxy for Liquidity for entity i in year t
LEVTLTAit = Total liabilities/ Total assets as proxy for Leverage for entity i in year t
MENIETAit = Non- interest expense/ total assets as proxy for Management efficiency for entity i in year t
MENIETIit = Non- interest expense/ total income as proxy for Management efficiency for entity i in year
MESCNIEit= staff expense/ total non interest expense as proxy for Management efficiency for entity i in year
NIMTA= Net interest income / Total assets as proxy for efficiency in earnings ability
AQLNTA= total loans/ total assets as proxy for Asset quality for entity I in year t
GDPit== real GDP growth for entity i in year t
| country | id | Name of credit union |
| St Vincent | VC | General Employees Cooperative Credit Union |
| St Vincent | VC | Kingstown Cooperative Credit Union |
| St Vincent | VC | Teachers Cooperative Credit Union |
| St Vincent | VC | Police Cooperative Credit Union |
| Grenada | GD | Grenada Public Service Cooperative Credit Union Ltd/ Ariza |
| Grenada | GD | Communal Cooperative Credit Union Ltd |
| Grenada | GD | Grenada Union of Teachers Cooperative Credit Union Ltd |
| Grenada | GD | Grenville Cooperative Credit Union Ltd |
| Grenada | GD | River Sallee Cooperative Credit Union Ltd |
| Grenada | GD | Birchgrove Cooperative Credit Union Ltd |
| Grenada | GD | Hermitage Cooperative Credit Union Ltd |
| Grenada | GD | Geo. F. Huggins Employees Cooperative Credit Union Ltd |
| Grenada | GD | Gateway Cooperative Credit Union Ltd |
| St. Lucia | LC | Choiseul Credit Union |
| St. Lucia | LC | Dennery Co-op Credit Union |
| St. Lucia | LC | Elk’s Co-operative Credit Union |
| St. Lucia | LC | Fond St. Jacques Credit Union |
| St. Lucia | LC | Hospitality Co-op Credit Union |
| St. Lucia | LC | Laborie Credit Union |
| St. Lucia | LC | Mon Repos Credit Union |
| St. Lucia | LC | National Farmers Credit Union |
| St. Lucia | LC | Mabouya Valley Credit Union |
| St. Lucia | LC | Royal St Lucia Police Credit Union |
| St. Lucia | LC | Saltibus Credit Union |
| St. Lucia | LC | St Lucia Civil Service Credit Union |
| St. Lucia | LC | St Lucia Teachers’ Credit Union |
| St. Lucia | LC | St Lucia Workers Credit Union |
| St. Lucia | LC | West Coast Credit Union |
| Dominica | DM | West Coast Credit Union |
| Dominica | DM | National Co-operative Credit Union Limited |
| Dominica | DM | Central Co-operative Credit Union Ltd |
| Dominica | DM | Marigot Credit Union |
| Dominica | DM | Grand Bay credit union |
| Antigua | AG | Antigua and Barbuda Police Co-operative Credit Union Ltd. |
| Antigua | AG | St. John’s Co-operative Credit Union Ltd. |
| Antigua | AG | Antigua Public Utilities Authority Credit Union Ltd |
| Antigua | AG | Community First Co-operative Credit Union Ltd. |
| St Kitts Nevis | KN | Nevis Co-operative Credit Union Ltd |
| St Kitts Nevis | KN | St Kitts Co-operative Credit Union Ltd |
| St Kitts Nevis | KN | Police Co-operative Credit Union (St Christopher and Nevis) Ltd |
| St Kitts Nevis | KN | FND Enterprise Co-operative Credit Union Ltd |
| Montserratt | MS | St Patrick’s Co-operative Credit Union Limited |
see sample total income of credit union in two islands
| Island | ID | Name of CU | YEAR | total revenue |
| St Vincent | GESV | GECCU | 2009 | 10,354,327 |
| St Vincent | GESV | GECCU | 2010 | 10,398,687 |
| St Vincent | GESV | GECCU | 2011 | 12,138,542 |
| St Vincent | GESV | GECCU | 2012 | 11,270,081 |
| St Vincent | GESV | GECCU | 2013 | 11,174,077 |
| St Vincent | GESV | GECCU | 2014 | 11,797,644 |
| St Vincent | GESV | GECCU | 2015 | 12,428,461 |
| St Vincent | GESV | GECCU | 2016 | 13,578,058 |
| St Vincent | GESV | GECCU | 2017 | 15,236,572 |
| St Vincent | GESV | GECCU | 2018 | 16,442,983 |
| St Vincent | KCSV | Kccu | 2009 | 4,515,787 |
| St Vincent | KCSV | Kccu | 2010 | 4,709,019 |
| St Vincent | KCSV | Kccu | 2011 | 5,081,558 |
| St Vincent | KCSV | Kccu | 2012 | 5,342,034 |
| St Vincent | KCSV | Kccu | 2013 | 5,323,653 |
| St Vincent | KCSV | Kccu | 2014 | 5,763,040 |
| St Vincent | KCSV | Kccu | 2015 | 6,412,253 |
| St Vincent | KCSV | Kccu | 2016 | 6,606,917 |
| St Vincent | KCSV | Kccu | 2017 | 7,013,308 |
| St Vincent | KCSV | Kccu | 2018 | 7,391,305 |
| St Vincent | TCSV | SVGTCU | 2009 | 5,178,180 |
| St Vincent | TCSV | SVGTCU | 2010 | 5,216,085 |
| St Vincent | TCSV | SVGTCU | 2011 | 5,333,753 |
| St Vincent | TCSV | SVGTCU | 2012 | 5,396,052 |
| St Vincent | TCSV | SVGTCU | 2013 | 5,616,913 |
| St Vincent | TCSV | SVGTCU | 2014 | 5,846,930 |
| St Vincent | TCSV | SVGTCU | 2015 | 6,810,108 |
| St Vincent | TCSV | SVGTCU | 2016 | 7,183,775 |
| St Vincent | TCSV | SVGTCU | 2017 | 7,545,126 |
| St Vincent | TCSV | SVGTCU | 2018 | 9,205,414 |
| St Vincent | PCSV | SVG PCCU | 2009 | 286,009 |
| St Vincent | PCSV | SVG PCCU | 2010 | 382,514 |
| St Vincent | PCSV | SVG PCCU | 2011 | 454,727 |
| St Vincent | PCSV | SVG PCCU | 2012 | 607,614 |
| St Vincent | PCSV | SVG PCCU | 2013 | 663,910 |
| St Vincent | PCSV | SVG PCCU | 2014 | 687,116 |
| St Vincent | PCSV | SVG PCCU | 2015 | 710,456 |
| St Vincent | PCSV | SVG PCCU | 2016 | 846,676 |
| St Vincent | PCSV | SVG PCCU | 2017 | 1,079,862 |
| St Vincent | PCSV | SVG PCCU | 2018 | 1,434,858 |
| Grenada | GPGD | GPSCCU Ariza | 2009 | 11,894,902 |
| Grenada | GPGD | GPSCCU Ariza | 2010 | 13,448,983 |
| Grenada | GPGD | GPSCCU Ariza | 2011 | 14,062,508 |
| Grenada | GPGD | GPSCCU Ariza | 2012 | 14,547,743 |
| Grenada | GPGD | GPSCCU Ariza | 2013 | 16,210,155 |
| Grenada | GPGD | GPSCCU Ariza | 2014 | 17,345,520 |
| Grenada | GPGD | GPSCCU Ariza | 2015 | 18,930,271 |
| Grenada | GPGD | GPSCCU Ariza | 2016 | 19,693,875 |
| Grenada | GPGD | GPSCCU Ariza | 2017 | 21,859,227 |
| Grenada | GPGD | GPSCCU Ariza | 2018 | 27,051,677 |
| Grenada | COGD | Communal CU | 2009 | 5,356,189 |
| Grenada | COGD | Communal CU | 2010 | 5,537,834 |
| Grenada | COGD | Communal CU | 2011 | 5,369,707 |
| Grenada | COGD | Communal CU | 2012 | 5,694,543 |
| Grenada | COGD | Communal CU | 2013 | 6,021,751 |
| Grenada | COGD | Communal CU | 2014 | 7,062,515 |
| Grenada | COGD | Communal CU | 2015 | 8,243,113 |
| Grenada | COGD | Communal CU | 2016 | 9,561,870 |
| Grenada | COGD | Communal CU | 2017 | 11,214,605 |
| Grenada | COGD | Communal CU | 2018 | 12,420,015 |
| Grenada | TCGD | GUTCU Ltd | 2009 | 6,515,695 |
| Grenada | TCGD | GUTCU Ltd | 2010 | 5,397,403 |
| Grenada | TCGD | GUTCU Ltd | 2011 | 6,422,996 |
| Grenada | TCGD | GUTCU Ltd | 2012 | 8,436,670 |
| Grenada | TCGD | GUTCU Ltd | 2013 | 7,883,065 |
| Grenada | TCGD | GUTCU Ltd | 2014 | 8,454,066 |
| Grenada | TCGD | GUTCU Ltd | 2015 | 9,309,879 |
| Grenada | TCGD | GUTCU Ltd | 2016 | 11,306,681 |
| Grenada | TCGD | GUTCU Ltd | 2017 | 12,234,225 |
| Grenada | TCGD | GUTCU Ltd | 2018 | 12,885,833 |
| Grenada | GRGD | Grenville CU | 2009 | 2,702,722 |
| Grenada | GRGD | Grenville CU | 2010 | 2,437,583 |
| Grenada | GRGD | Grenville CU | 2011 | 2,721,197 |
| Grenada | GRGD | Grenville CU | 2012 | 2,990,566 |
| Grenada | GRGD | Grenville CU | 2013 | 2,991,927 |
| Grenada | GRGD | Grenville CU | 2014 | 3,173,221 |
| Grenada | GRGD | Grenville CU | 2015 | 4,303,848 |
| Grenada | GRGD | Grenville CU | 2016 | 5,386,710 |
| Grenada | GRGD | Grenville CU | 2017 | 6,570,723 |
| Grenada | GRGD | Grenville CU | 2018 | 6,175,084 |
