Equilibrium in Labor Markets: Stable Matches Lead to Efficient Job Allocation.
Competitive labor markets can reach stable equilibrium even with workers choosing jobs, as long as workers are seen as interchangeable by firms. The equilibrium favors those making offers, and adding more agents to the market has predictable effects. The study explores how different types of workers and jobs interact in the labor market, considering factors like uncertainty, specialization, and set-up costs.