According to Classical theory, what is assumed about wage flexibility?

In Classical economic theory, wage flexibility is a key assumption. The theory posits that wages are perfectly flexible, meaning they can easily adjust in response to changes in supply and demand for labor. This flexibility allows the labor market to reach equilibrium, where the quantity of labor supplied matches the quantity of labor demanded.

When wages are perfectly flexible, if there is an excess supply of labor (unemployment), wages would decrease, encouraging employers to hire more workers until full employment is achieved. Conversely, if there is a labor shortage, wages would rise, attracting more workers into the market. Therefore, the assumption of wage flexibility is fundamental to the Classical view that markets, including the labor market, are self-correcting and always tend toward equilibrium. This belief underpins many Classical economic models and their projections about how economies function.