Creating an aggregate demand from land in the utility function

[pmichaillat]

Section 2.4 in this paper shows how to create an aggregate demand with land in the utility function. Online appendix B of the same paper shows that assuming money in the utility, or bonds in the utility, or land in the utility, is essentially isomorphic. All these assumptions generate similar aggregate demand curves.

These results and derivations might be helpful for @YoshiShono's project, and possibly for @DizhiWang's project (possibly to break the international Say's law).

[YoshiShono]

Thank you so much! Liu et al. (2013) is the paper that Dizhi gave a presentation last quarter. In addition to the main text setting (land is a state variable), I find that land in utility works when households choose current land level with two-period setting (that is, land is a choice variable. Of course, if my calculation is correct).