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Directed Search and Competitive Search Equilibrium: A Guided Tour

  • Randall Wright
  • Philipp Kircher
  • Benoît Julien
  • Veronica Guerrieri
Journal of Economic Literature
vol. 59, no. 1, March 2021
(pp. 90-148)
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Abstract

This essay surveys the literature on directed search and competitive search equilibrium, covering theory and a variety of applications. These models share features with traditional search theory, but also differ in important ways. They share features with general equilibrium theory, but with explicit frictions. Equilibria are often efficient, mainly because markets price goods plus the time required to get them. The approach is tractable and arguably realistic. Results are presented for finite and continuum economies. Private information and sorting with heterogeneity are analyzed. While emphasizing issues and applications, we also provide several hard-to-find technical results.

Citation

Wright, Randall, Philipp Kircher, Benoît Julien, and Veronica Guerrieri. 2021. "Directed Search and Competitive Search Equilibrium: A Guided Tour." Journal of Economic Literature, 59 (1): 90-148. DOI: 10.1257/jel.20191505

Additional Materials

JEL Classification

  • D50 General Equilibrium and Disequilibrium: General
  • D83 Search; Learning; Information and Knowledge; Communication; Belief; Unawareness