In Japan, they were “three excesses” in the business sector: employment, production capacity, and debt (Chart 15). 16 It is essential to explicitly incorporate an adjustment mechanism of “excesses” in analyzing the economy after the burst of a bubble.
In the years prior to the surge in demand, global research into improving yields was relatively low, as was investment in expanding the supply of arable land. This is one of the consequences of the low level of prices in the 1980s and 1990s.