In the late 1990s, firms invested in high-tech goods at a very rapid pace, spurred at first by plunging prices and robust business output growth and eventually by an apparently overly optimistic view about the returns on those investments. Subsequently, high-tech investment dropped at a double-digit rate in 2001 and fell further in 2002.
This sharp decline, combined with the high depreciation rates on these types of goods, severely curtailed growth of the capital stock, and any overhang seems likely to have been eliminated relatively quickly. However, desired or optimal capital stocks are notoriously difficult to specify and measure, and hence so are overhangs, even several years after the episode.