Application of the Fuzzy VIKOR Method to Assess Concentration and Its Effects on Competition in the Energy Sector

Abstract

Background: Understanding the market competition is one of the most important factors for examining and assessing competition issues, and is of growing interest in business sustainability research. Markets in the energy industry, which are notoriously harder to monitor, are often presented with scenarios in which the strength of various market parties varies, making harmonization a significant problem. This article’s aim is to find the feasibility of measuring the HHI in the implementation of business strategies in order to avoid market distortions in the energy industry. The uniqueness of this article is that it outlines the capabilities of the fuzzy VIKOR approach for assessing the HHI in order to avoid a distorted market by examining the most important economic parameters in the energy market. This paper’s contribution is compiling the HHI evaluation system in the energy sector, with the goal of identifying the market conditions of corporate entity and assisting in the attainment of long-term market competitiveness. The results demonstrate that a comparison of the fuzzy VIKOR (VlseKriterijuska Optimizacija I Komoromisno Resenje) approach with probability theories proved that it is possible to measure the HHI-based performance of the energy sector.