An inward shift of a PPF

PPF will shift inwards if:

Resources run out
If essential non-renewable resources, such as oil and gas, are exhausted the productive capacity of an economy may be reduced. This may happen when countries over-specialise in producing goods from non-renewable resources. Sustainable growth means that the current rate of growth is not so fast that future generations are denied the benefit of scarce resources.

Failure to invest

A failure to invest in human and real capital to compensate for depreciation will reduce an economy’s capacity. Real capital, such as machinery and equipment, wears out with use and its productivity falls over time. As the output from real capital falls, the productivity of labour will also fall. The quality and productivity of labour also depends on the acquisition of new skills. Therefore, if an economy does not invest in people and technology its PPF will slowly move inwards.

Erosion of infrastructure through war
Military conflict is likely to destroy factories, people, communications, and infrastructure, and shift the PPF inwards.

Natural disaster
A natural disaster, such as the 2005 boxing day tsunami, the Haiti earthquake of 2010, or the Japanese tsunami and earthquake in 2011, will result in an inward shift of an economy’s PPF.