Directed Search and Competitive Search Equilibrium: A Guided Tour

This essay surveys the literature on directed search and competitive equilibrium, covering theory a variety of applications. These models share features with traditional theory, but also differ in important ways. They general equilibrium explicit frictions. Equilibria are often efficient, mainly because markets price goods plus time required to get them. The approach is tractable arguably realistic. Results presented for finite continuum economies. Private information sorting heterogeneity analyzed. While emphasizing issues applications, we provide several hard-to-find technical results. (JEL D50, D83)