Assessment of Pathways to Collapse in the DPRK
Abstract
The collapse of the North Korean economy and disastrous famine of the mid-1990s forced the regime to adapt its centrally-planned economymost notably by allowing limited and small-scale private entrepreneurship among a starving population that the governments Public Distribution System could no longer support. In this context, the North Koreans had turned to informal markets for sustenance in order to survive (Gause, 2018; Park, 2018; Platte, 2018; Rinna, 2018). This bottom up marketization resulted in policy reforms that followed rather than led the transition (Haggard and Noland, 2005; Park, 2018; Platte, 2018; Rinna, 2018). While the regime acknowledged the need for these informal markets to meet needs that it could not fulfill, and even instructed state institutions to find profit-making opportunities, the regime nonetheless remained ideologically opposed to marketization and capitalism. The leadership even enacted policy reversals in late 2005 intended to roll back some of this change including banning private trade in grain, resuscitating the quantity rationing system, andrever[ting back] to confiscatory seizures from rural cultivators (Haggard and Noland, 2005). The regimes 2007 and 2009 efforts to inhibit private entrepreneurship and decelerate marketization (e.g., through currency reform) were ultimately unsuccessful (Park, 2018). The informal economy is still in place, represents a substantial sector of the total economy, and has fostered a new stratum of wealthy North Koreans, unattached to the military or traditional elite Hastings, 2017). The result today is the emergence and continued growth of private entrepreneurs. One estimate is that 20% of the North Korean population is directly or indirectly reliant on general markets for survival (DailyNK, 2018). Simultaneously, there are party and military organizations with their own trading companies.
Document Details
- Document Type
- Technical Report
- Publication Date
- Nov 01, 2018
- Accession Number
- AD1066698
Entities
People
- Larry A Kuznar
- Sabrina J. Pagano