These regulatory reforms are backed by a more intrusive supervisory system, including more extensive on-site inspections and enhanced enforcement powers. Legal systems have also been reformed to improve insolvency frameworks, even if much remains to be done.
It has been argued that the productivity gap of the nonmanufacturing sector vis-à-vis manufacturing was partly responsible for pushing up services prices (according to  4  For details, see Fumio Hayashi and Edward Prescott, “The 1990s in Japan: A Lost Decade,” Review of Economic Dynamics, 5, pp. 206–235, 2002.