Economics of Employment Agencies

Employment agencies have gained an increasing significance in
matching employment and vacancies in the economy. Solo searches by
workers, and shorterperiods of employment, have necessarilyadded to the
need for third party agents for the matching process in labour markets.
Thus the existence of these agents and sole agent searches has created a
multiplicity of wages across labour . markets. We discuss futher the
implications of search and bargaining in this model