Some plants take nutrients from the soil others contribute nutrients. If you have the same plants in the same spot all the time, you will end up nutrient deficient, and your plants will be unhealthy and susceptible to disease. If you rotate crop families you generally end up with a healthier garden. An "ideal" garden, with all vegie families, will rotate quite easily. If you limit what sort of veggies you have, you may find you need to replace nutrients (so if, for instance, you only grow tomato and lettuce, you a not rotate enough and would need to replace nutrients via vegie foods for the soil etc)
A full rotation system includes beds that are "resting" or that are growing green manure crops like broad beans, peas, alfalfa or lupins which actually put nitrogen back into the soil. When they get big enough, you chop em down and either dig them in or let them rot down into mulch over the bed. This obviously takes time, but it's a tried and true way to maintain your soil quality over time. Using legume-based straws like pea straw and lucerne hay shortens the time needed but costs more and adds less nitrogen than a grown mulch.
We use a green manure over winter and tend to rest a section of garden each season (well, we try to, but it has become dd's equivalent of a home sand/dirt pit!)
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