2026/07/25 by Eric Auerbach, Jonathan Auerbach, Sidonia McKenzie
Economics, Econometrics and Finance · Mathematics · #econ.EM #stat.ME
Researchers often use the density of connections between groups of agents, such as communities, blocs, or markets, to characterize the structure of a social or economic network. In many cases, these groups are selected using the network data, making conventional fixed-group inference procedures potentially invalid. To address this issue, we develop two new confidence intervals that are universally valid post-selection in the sense that they guarantee simultaneous coverage asymptotically over all pairs of groups whose relative sizes do not vanish. Our first interval builds on a strategy of Berk et al. (2013). Our second interval is based on a Talagrand-type concentration inequality for empirical processes. Both intervals are simple to compute and scalable to large networks, but a key technical contribution of our paper is to show that the second interval is rate-optimal over a broader class of intervals. Three empirical illustrations show that accounting for selection can matter in practice. Some evidence for homophily in a social network and a hub-and-spoke structure in a trade network survives our correction, while evidence for a segmented market structure in a worker transition network does not.