Black market film prices

From a recent article in Time:

In recent years, bootlegged South Korean dramas have been flooding into the northern neighbor — part of a recent explosion across Asia in the popularity of South Korean TV shows and music known as the Korean Wave. On the black market in North Korea, American DVDs go for about 35¢; South Korean ones go for $3.75, because of the higher risk of execution for smuggling them in, according to two recent defectors from Pyongyang. The nation’s films and dramas have become so widespread across North Korea that the regime launched a crackdown this fall on North Korean university students, the movies’ biggest audience, and smugglers at the Chinese border, charging some with promoting the ideology of the enemy state.

It seems plausible that South Korean films are more expensive than American films due to political risk, but this cannot be the only factor.  DPRK politics aside, South Korean and American films are not perfect substitutes.  I am willing to bet that some of the price difference can be explained by the language barrier.  North Koreans can watch South Korean films and dramas without reading subtitles.  Some of the stories, characters, and motivations probably make more sense as well.

We can make apriory assumptions all day, however.  We need some data. There is a paper in here for an enterprising economics student living near Dandong.

Read the full story here:
Soap-Opera Diplomacy: North Koreans Crave Banned Videos
Geoffrey Cain


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