If the option premium is overpriced under the perception of ever-rising land value, the option value for convertible use of land may give rise to accelerated land prices; it has in fact been observed that residential land prices follow the acceleration of commercial use land prices. The price of commercial land in Japan's major cities has risen more than 10% recently. 11.
Indeed, this ability relies on the government being able to access markets under favourable conditions at the time when it needs to, at the  2  BIS central bankers’ speeches  trough of the cycle. As we have seen during the crisis, this cannot be taken for granted when doubts arise about the sustainability of the debt.