# Re: st: calculate concentration ratio of four firms

 From "Martin Weiss" To statalist@hsphsun2.harvard.edu Subject Re: st: calculate concentration ratio of four firms Date Sun, 27 Dec 2009 21:31:58 +0100

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Here is a worked example for you. Try it carefully, and see whether it really does what you want:

***
clear*

//three sectors
set obs 3
gen byte sector =_n

//expand to firm level
expand 10
bys sector: gen byte firmid=_n

//expand to time dimension
expand 4
bys sector firmid: gen year =2002+_n

//get sales data from normal distr
gen double sales=rnormal(1000000,300000)

//unbalance the thing!
replace sales=. if runiform()<.1

//"1stly, total sales of industry j at time t (Yjt)"
bys sector year: egen double totsalesjt=total(sales)

//"2ndly, share of a firm i in
//industry j (sales of firm i/Yjt)*100=a"
gen shareoffirm=(sales/totsalesjt)*100

//check shares for consistency
total shareoffirm, over(sector year)

//"3rd a^2 for each firm at time t"
gen double asquared=shareoffirm^2

//"4 step is problematic" (bear in mind unbalanced form!)
bys sector year: egen nonmiss=count(shareoffirm)
bys sector year: gen start=nonmiss-3

bys sector year (shareoffirm): /*
*/ egen firstfourtotal= /*
*/ total(((_n>=start)&(_n<=nonmiss))*shareoffirm)

***

HTH
Martin
-------- Original-Nachricht --------
> Datum: Sun, 27 Dec 2009 16:42:54 +0200 (EET)
> Von: "Alper [iso-8859-9] Sönmez" <salper@metu.edu.tr>
> An: statalist@hsphsun2.harvard.edu
> Betreff: st: calculate concentration ratio of four firms

> Hi, I want to calculate the first four firms share in each industry at
> time t (HHI4 or CH4). I calculated the shares but i cannot sum first four
> firms shares in each industry at time t.
> I tried egen and gen commands with several functions  but they were not
> worked
> Also i did not find any solution or material from stata books and online
> resources
> I have an Unbalanced firm level panel data with variables id, years(t)
> 2003-2006, and 2digitsectors(Sector)and it is in long form
>
> The problem:
> I calculated
> 1stly, total sales of industry j at time t (Yjt)
> 2ndly, share of a firm i in industry j (sales of firm i/Yjt)*100=a
> 3rd a^2 for each firm at time t
>
> 4 step is problematic: I can not calculate shares of first four firms in
> sector j at time t
> like this max(a+a+a+a) by (sector year) and write this value for firms in
> these sector and year
>
>
>
>
>
>
>
> --
> Alper Sönmez
>
> ODTÜ/METU
> ÝÝBF Ýktisat Bölümü/FEAS Department of Economics
> Ankara Türkiye
> Tel/Phone:0312 210 30 77
> Fax: 0312 210 79 64
>
>
>
>
> *
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```