Multiple comparisons with the best, with economic applications

William C. Horrace, Peter Schmidt

Research output: Contribution to journalArticlepeer-review

71 Scopus citations


In this paper we discuss a statistical method called multiple comparisons with the best, or MCB. Suppose that we have N populations, and population i has parameter value θi. θ(N) Let = maxi=1,⋯,Nθi the parameter value for the 'best' population. Then MCB constructs joint confidence intervals for the differences [θ(N) - θ1, θ(N) - θ2,⋯, θ(N) - θ(N)]. It is not assumed that it is known which population is best, and part of the problem is to say whether any population is so identified, at the given confidence level. This paper is meant to introduce MCB to economists. We discuss possible uses of MCB in economics. The application that we treat in most detail is the construction of confidence intervals for inefficiency measures from stochastic frontier models with panel data. We also consider an application to the analysis of labour market wage gaps.

Original languageEnglish (US)
Pages (from-to)1-26
Number of pages26
JournalJournal of Applied Econometrics
Issue number1
StatePublished - 2000
Externally publishedYes

ASJC Scopus subject areas

  • Social Sciences (miscellaneous)
  • Economics and Econometrics


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