North Korean Economy Watch

Korea Times
2/5/2007

Hyundai Asan, the company specializing in inter-Korean business cooperation, Monday marked its eighth anniversary.

The affiliate under the Hyundai Group, led by Hyun Jung-eun, the widow of Chung Mong-hun, the successor of the group founder Chung Ju-yung, said that this year it plans to attract 400,000 tourists to Mt. Kumgang, the North Korean scenic mountain on the East Coast.

Hyundai Asan also said that it also will push ahead with tours of Kaesong, a historic North Korean city near the inter-Korean border that is home to a South Korean-invested industrial complex, this year so as to meet its sales target of 300 billion won.

Under its plan, Hyundai plans to hold working-level meetings with North Korea so as to hasten the start of the Kaesong tours.

However, industry observers say that Hyundai may find it difficult to meet this year’s sales goal because of the nuclear confrontation between Pyongyang and the international community. Last year, Hyundai set its target for tourists at 400,000 but fell short at 240,000 after a series of provocative actions by the North starting with its test of a nuclear device.

That worsened the financial situation of Hyundai Asan, forcing it to make 10 percent of its work force at its headquarters work from home in a restructuring move.

Hyundai officials said that this year the situation may improve, but this would be unlikely to have any direct bearing on its bottom line.

Yonhap
2/5/2007

The United States may recognize goods produced at a joint industrial complex just north of the border as South Korean if there is a change in circumstances, the top U.S. diplomat here said Monday.

In a one-hour meeting with Unification Minister Lee Jae-joung, U.S. Ambassador Alexander Vershbow said that while it is unrealistic to recognize the goods made in the border city of Kaesong as South Korean, there is room left to negotiate within the proposed free trade agreement (FTA) between the two countries, Unification Ministry officials said.

“Lee stressed that U.S. recognition of the goods produced in Kaesong as South Korean will contribute to bringing about a lasting peace on the Korean Peninsula. Vershbow said ‘if,’ but he did not elaborate on what kind of change under what kind of circumstances,” said a ministry official who was present at the meeting, but who asked to remain anonymous.

So far, the U.S. has avoided placing the issue on the official agenda of the FTA negotiations, so Vershbow’s remarks could be construed as a slight change in U.S. strategy toward forging a free trade deal with South Korea.

In spite of United Nations sanctions on the North following its nuclear weapon test in October, South Korea has kept two major cross-border joint projects afloat: an industrial complex in Kaesong just north of the border, and a tourism program at the North’s scenic Mount Geumgang.

In the industrial complex, South Korean businesses use cheap North Korean labor to produce goods. Twenty-one South Korean factories employ about 11,160 North Korean workers in Kaesong.

The six-party talks aimed at ending North Korea’s nuclear weapons program, involving the two Koreas, the U.S., China, Japan and Russia, will reconvene in Beijing on Thursday.

US May Accept Kaesong Goods
Korea Times
Ryu Jin
2/5/2007

The United States might recognize goods made at a joint industrial complex in the North Korean border city of Kaesong as South Korean products in a proposed free trade agreement (FTA) if there is a change in circumstances, the top U.S. diplomat in Seoul said Monday.

U.S. Ambassador to Seoul Alexander Vershbow said in a meeting with Unification Minister Lee Jae-joung that, although it seems unrealistic at the moment to recognize the Kaesong products as South Korean, there is room left to negotiate within the proposed FTA.

“Lee stressed that U.S. recognition of the goods produced in Kaesong as South Korean will contribute to bringing about a lasting peace on the Korean Peninsula,” a ministry official said after the meeting. “Ambassador Vershbow said `if,’ but he did not elaborate on what kind of change under what kind of circumstances.”

Vershbow’s remarks could be interpreted as a sign of change in U.S. strategy since Washington has so far refused to deal with the issue as an official agenda item in the ongoing negotiations for a South Korea-U.S. FTA.

Inter-Korean ties have soured in recent years in tandem with the deteriorating North Korea nuclear standoff. But the six-party talks aimed at ending North Korea’s nuclear program is expected to see a substantial progress in the coming round of negotiations.

South Korea has kept afloat its major cross-border projects with North Korea, including the joint industrial park in Kaesong and a tourism program at the North’s scenic Mt. Kumgang, even after Pyongyang’s nuclear test in October.

South Korea has exerted much effort to have its counterparts in FTAs, such as Southeast Asian countries, recognize the Kaesong products as “made in Korea” because it has a significance to further promote the joint industrial project.

A total of 21 South Korean factories are operating in the Kaesong industrial park at present, employing over 10,000 North Korean workers.

Korea Herald
Kim Yoon-mi
2/5/2007

Eight years have passed since the late Chung Ju-yung, the former chairman of Hyundai Group, initiated the first inter-Korean tourism business with Hyundai Asan Corp., which operates tours to North Korea’s Mount Geumgang resort.

Since Hyundai Asan’s tour businesses have been held back by the North’s mixed messages and frequent changes in Seoul’s policy toward Pyongyang, they plan to attract 400,000 South Korean tourists and fast-track the official launch of tour of the North Korean city of Gaeseong, Hyundai officials said yesterday.

Hyundai Asan president and CEO Yoon Man-joon on Saturday paid a tribute to the family graveyard of the late Chung Ju-yung and Chung Mong-hun with Hyundai Asan executives. Yoon asked them to put forward their best efforts to meet the 2007 business target, Yonhap News reported.

“Although we had some difficulties last year, I’m doing my best to do better. We will see a good result this year if every one gets proactive,” Yonhap News quoted Yoon as saying.

Hyundai Asan’s tourism plan in Gaeseong was dampened when North Korea requested to sign a deal with another Korean company Lotte Tours Co. in August 2005, despite the earlier contract with Hyundai Asan.

In January this year, North Korea seemed turning to the original contract with Hyundai Asan when Seoul’s Unification Minister Lee Jae-young and Hyundai Group chairwoman Hyun Jeong-eun visited an industrial complex in Gaeseong on Jan. 24.

However, Pyongyang media once again denied South Korea’s local reports that the North will promote Gaeseong tourism with Hyundai Asan.

The biggest blow to Hyundai Asan last year was North Korea’s nuclear test on Oct. 9. With the tension created on the Korean peninsular after North’s nuclear test, the number of Mount Geumgang tourists plummeted, causing the failure of Hyundai Asan to meet the initial target of 400,000 vivitors. The number reached only 240,000 last year.

Hyundai Asan’s posted sales of 235 billion won ($249 million) and an operating profit of 2 billion won last year, which is a disappointing performance according to experts.

This year, Hyundai Asan said it will beef up its profitability by launching a new tour package to inner Geumgang, a golf course at the mountain resort, and offering a Gaeseong tour.

According to the company, it will open a new tour of inner Geumgang in April, have a test round at the golf course in June and open it in late October, aiming to attract more tourists.

For the Gaeseong industrial complex, Hyundai Asan said it will complete laying the ground work on the 3.3 million square meters of land by June and start working-level meetings on the second-phase development of the area with North Korean officials later on.

“The urgent issue for our company this year is to establish a solid profit structure so that it won’t be shaken by North Korean issues,” Yonhap quoted an official at Hyunda Asan as saying.

Korea Times
Andrei Lankov
2/4/2007

Corruption is elusive. A vast majority of corrupt transactions are done in secret and remain secret forever. No scholar has ever been able to measure the corruption level even though everybody agrees that it varies markedly, depending on place and time.

Nonetheless, there is no way to make an informed judgment on whether or not, say, the Britain of the 1670s was more corrupt than China of the 1820s. Even the oft-cited Global Corruption Reports of Transparency International is based, essentially, on the personal impressions of the people in the know (largely, businesspeople), not on direct measurements.

North Korea is not considered in the Global Corruption Report. However, everyone with first-hand experience of North Korea agree that corruption and bribery are very common there.

It has not always been the case. Indeed, back in the 1950s one of the features that attracted many Koreans to the North was the relative austerity of its ruling elite. The North Korean administration might have been wasteful, indifferent to human suffering, and irrational, but it was clean _ in marked contrast to Syngman Rhee’s regime in the South.

This did not mean that everybody had his or her fair chance.

On the contrary, people with a “bad social origin” were nonstarters by definition, and they formed a significant minority of the population. One’s connections were important, too. In 1957, Yu Sung-hun, the then president of Kim Il-sung University, complained to a Soviet diplomat that every year “queues of cars” waited near his office on the eve of the entrance exams (a car was a sign of extremely privileged social position).

The president, an honest educator and intellectual, felt guilty and upset because he had to accept the scions of top bureaucrats at the expense of gifted people without the right connections. But, one assumes, this was achieved by the application of political pressure alone, with no money involved.

The situation began to deteriorate in the late 1970s. Perhaps, this reflected the slow decline in idealism: Earlier generations sincerely believed that they were constructing a paradise on earth, but people who became adults in the 1970s and 1980s had fewer illusions. They lived in a society that was run by a hereditary elite, where one’s family background comprehensively determined one’s lifestyle, and where the official slogans were increasingly seen as irrelevant or hypocritical. Thus, bribes began to spread.

What did the North Koreans pay bribes for? Generally, for chances of social advancement, or to access to goods and services one would not normally be eligible for. Thus, sale clerks in the shops, despite their meager official salary, became one of the most affluent groups in society.

They used their access to goods to sell better quality stuff outside the official rationing system and at huge premiums.

In the 1980s corruption became ubiquitous at the colleges where one’s chances of being admitted were greatly improved by an envelope given to an influential professor or bureaucrat. There are stories that the right to join the ruling Korean Workers’ Party was sometimes also purchased through a bribe (this right is important since it makes a person eligible for white-collar positions). Finally, it was becoming quite common to pay a superior to ensure a good position.

The bribes were not necessarily paid in money. Quality liquor or imported cigarettes were even better, and good old greenbacks the best of all.

But it was only in the 1990s that bribery truly became ubiquitous.

The breakdown of old systems of control meant that there was less to be afraid of.

There were also fewer rewards available for the “good citizens of the socialist motherland.”

Finally, the collapse of the economy produced a multitude of opportunities for corruption.

Apart from the sales clerks who have always been engaged in small bribery, the drivers, train conductors and the like began to accept money for letting traders travel with their merchandise, as well as looking the other way when people could not produce valid travel permits (in the latter case policemen have also pocketed their share).

But what about the top crust of society? We do not know much about this, but it appears that they have not been touched by these trends yet.

After all, they already have enormous privileges, and in North Korea there is no private business to tempt them with good pay-offs. Probably, this is going to change soon.

Joong Ang Daily
Jo Dong Ho
2/3/2007

The New Year editorial is a frank admission of failure by Pyongyang.

After Kim Il Sung, the founder of North Korea, issued his first new year’s message, “Announcement to all North Korean people on the occasion of the New Year,” in 1946, those New Year’s Day messages have been an annual event in North Korea. Before the death of Kim Il Sung, they were messages of hope to the people, delivered by the Great Leader live on the achievements of the past year and plans for the new one.

So on New Year’s Day, North Koreans used to gather in front of radios or later, televisions, to participate in the “sacred ceremony” of listening to the leader’s message.

After his death, the live New Year message was replaced by a joint editorial of three newspapers, the organs of the North Korean Workers’ Party, the People’s Army and the Youth Vanguard.

That pattern was set only in 1995, but the nature of the message, the “message of hope,” was not changed at all.

But this year’s message has changed; it is gloomy rather than hopeful. Although the title, “With the high spirit of triumph, let’s open the golden days of the military-first Korea,” is colorful, in the text there are paragraphs that frankly admit the poor living conditions of today and give no hope for improvements in the near future. The text also confesses that there are no special means available to solve the many problems facing the isolated nation.

The joint editorial this year highlighted “economic revival” as the most urgent task North Korea is now facing. Departing from the traditional rhetoric of mentioning political ideology first and then going on to military affairs and the national economy, this year’s message referred to the economy first, which is unusual. Especially, this is the first time that the expression “economic development is our desperate need” has been found in a joint editorial since they were first published in 1995.

Unlike in the past, there is no detailed explanation of last year’s economic achievements. To the contrary, the editorial admitted that the economic difficulties, including food shortages, have persisted until now. The editorial says that North Korea has endured “its worst difficulties in the past 10 years” and has to solve the problem of feeding people “as it did in the past.”

That means that the North Korean economy is in very serious difficulty. Actually, there is a possibility that the North’s economy might have have had negative growth last year for the first time in seven years. Inflation is worse than ever, and the juche, or self-reliant, economy has rather crumbled into a U.S. dollar-reliant economy. The economy has deteriorated to the state where most North Korean residents cannot survive if they don’t engage in some sort of business. The focus of economic policy this year is on the improvement of people’s lives. It is unusual for North Korea, but the editorial frankly admitted that North Korea is “in desperate need” of consumer goods and even declared that the improvement of people’s lives was the “ultimate principle” that the North Korean authorities should work on attaining.

But the North Korean authorities have failed to present any practical strategies except the slogan of self-reliant economic revival. Since the beginning of the 2000s, the slogan “self-reliant revival” had disappeared, but it became the key word of the joint editorial. The editorial of the Rodong Shinmun, the organ of the North Korean Workers’ Party, even explained in its Jan. 8 issue that the spirit of this year’s joint editorial could be summed up as “building an economically strong nation and achieving self-reliant economic revival.” It is a message that “everybody should find their own way of living,” since it is not possible for the government to provide assistance to solve the many economic difficulties. But how can North Koreans solve all the economic problems with their own hands if they are not living in a primitive agricultural society? Ultimately, the North Korean authorities will have no other choice but to rely on outside help. There is no alternative but to seek help from South Korea while the North exerts diplomatic efforts of its own to ease economic sanctions.

Therefore, there is a large probability that the resolution of the North Korean nuclear problem through U.S.-North Korea talks and the six-party talks will progress unexpectedly smoothly. The joint editorial’s intensity of criticism against the United States is considerably lower than in past editorials. The U.S. strategy of using both a stick, freezing North Korean accounts at Banco Delta Asia; and a carrot, the possibility of guaranteeing the security of the regime and giving economic aid, was effective.

In order to get economic aid, North Korea will also engage South Korea in talks, a good opportunity for us. I hope we can fix the problems in that cooperation, such as the Kaesong Industrial Complex, where South Korean companies cannot employ or discharge North Koran workers by themselves or pay wages to workers directly, and rice aid to North Korea that is provided in the form of loans to avoid controversy over unreciprocated aid from Seoul.

*The writer is the head of North Korean Economy Research Team of the Korea Development Institute. Translation by the JoongAng Daily staff.

Choson Ilbo
2/2/2007
 
Russia is trying to strengthen ties with North Korea, citing a “China threat” in Korea and the Far East. The Gudok, the daily newspaper of Russian Railways, said in an article Tuesday, “If China takes control of Najin port in North Korea, Russia may suffer huge losses in the project to link the TKR (Trans-Korea Railway) and the TSR (Trans-Siberian Railway).”

Gudok is published by Vladimir Yakunin, the president and CEO of Russian Railways and one of the closest allies of Russian president Vladimir Putin. Sources say the report can be viewed as Russia’s official position as it tries to expand its influence with Pyongyang.

“China has completed feasibility studies for Najin port and is now doing repairs and upgrades to wharfs and container unloading facilities,” the article said. It said that because the port lies at the start of the Najin-Hasan Railway and does not freeze throughout a year, Russia must take hold of it.

“China has already requested that the UNDP, or UN Development Program, give the Chinese the right of free passage in the UNDP-initiated Tumen river development project. What China aims to achieve is to establish its own port in North Korea as a foothold to advance into the Pacific Ocean,” the article said. The newspaper urged the Russian government to respond aggressively.

Sources with the Korean government said Thursday, “The Russian government suggested late last year that it would pursue a railway modernization plan on a 54km stretch of the Najin-Hasan line with its own money, without support from South Korea, if we expand container transportation on the route between Busan and Najin.”

Currently only North Korean trains are in service on that stretch of railway. Russia has been working on the line since July, converting its narrow gauge to the standard that supports container transportation.

North Korea, which has sent around 10,000 construction workers and loggers to the Far East region, is welcoming closer cooperation with Russia. When president Putin announced last Saturday that Russian would spend 100 billion rubles (W3.7 trillion) to hold the Asia Pacific Economic Cooperation summit in Vladivostok in Russia, North Korean consulate-general Shim Kuk-ryeong in Nachodka said, “North Korea is ready to join major construction projects as soon as Vladivostok’s infrastructure development project starts.”

Russia’s efforts to expand its influence with North Korea can be seen as falling within the context of Putin’s recent emphasis on the Far East. Late last year, Putin said, “Russia’s security is now being threatened with the illegal migration of Chinese into the Far East.”

Yonhap
2/2/2007

China has made little investment in North Korea since the North conducted its first nuclear device test in October last year, but their two-way trade volume rose 21.6 percent year-on-year over the past few months, informed sources said Friday.

“Over the three months since the October test, China made no investment in the North except in some low-budget mining development. But North Korea’s dependence on China in terms of trade increased sharply,” a senior government official said, asking to remain anonymous because of the sensitivity of the information.

Another source said from October to November in 2006, the trade volume between North Korea and Japan declined 75 percent year-on-year to US$7.9 million, illustrating the full range of the impact from United Nations sanctions over the North’s surprise nuclear test, they said.

Japan has shown the strongest response to the North’s nuclear test and long-range missile launches last year, banning North Korean goods and citizens from entering the country as well as barring its ships from Japanese ports.

In all of 2006, the trade volume between North Korea and China rose 7.5 percent year-on-year to $1.69 billion, while two-way trade between North Korea and Japan decreased 34 percent to $119 million in the first 11 months of last year, the source said.

“North Korea can make financial dealings only via Russia and a few other countries because it has a lot of trouble in doing financial transactions and wooing investments since the United States imposed financial sanctions on the North in September 2005,” he said.

The U.S. cut off Macau-based Banco Delta Asia’s access to the U.S. financial system, alleging that North Korea used the bank to counterfeit U.S. dollars and engage in other financial wrongdoing.

North Korea boycotted the six-party talks on its nuclear disarmament until December, saying that the U.S. should discuss ways to lift the sanctions on the sidelines of the six-nation talks involving the two Koreas, the U.S. China, Japan and Russia.

the Economist
2/1/2007

Online dating in Pyongyang? Surely not

KIM JONG IL, North Korea’s dictator, has interests in modern technology beyond his dabbling in nuclear weaponry. In 2000 he famously asked Madeleine Albright, then America’s secretary of state, for her e-mail address. Mr Kim believes there are three kinds of fool in the 21st century: smokers, the tone-deaf and the computer-illiterate.

One of his young compatriots is certainly no fool. “Officially, our computers are mainly for educational and scientific purposes,” he says, before claiming: “Chatting on our web, I also met my girlfriend.”

Internet dating is only one of the surprises about the internet in North Korea, a country almost as cut off from the virtual world as it is from the real one. At one of the rare free markets open to foreigners, brand-new computers from China are sold to the local nouveaux riches complete with Windows software. Elsewhere, second-hand ones are available far more cheaply. In most schools, computer courses are now compulsory.

In the heart of the capital, Pyongyang, visitors are supposed to be able to surf freely through the 30m official texts stored at the Grand People’s Study House, the local version of the Library of Congress. The country’s first cyber café opened in 2002 and was soon followed by others, even in the countryside. Some are packed with children playing computer games.

But the world wide web is still largely absent. Web pages of the official news agency, KCNA, said to be produced by the agency’s bureau in Japan, divulge little more than the daily “on the spot guidance” bestowed by Kim Jong Il. No one in Pyongyang has forgotten that glasnost and perestroika—openness and transparency—killed the Soviet Union.

The local ideology being juche, or self-reliance, the country installed a fibre-optic cable network for domestic use, and launched a nationwide intranet in 2000. Known as Kwangmyong (“bright”), it has a browser, an e-mail programme, news groups and a search engine. Only a few thousand people are allowed direct access to the internet. The rest are “protected” (ie, sealed off) by a local version of China’s “great firewall”, controlled by the Korean Computer Centre. As a CIA report puts it, this system limits “the risks of foreign defection or ideological infection”. On the other hand, North Koreans with access to the outer world are supposed to plunder the web to feed Kwangmyong—a clever way to disseminate technical information to research institutes, factories and schools without losing control.

Yet even today, more and more business cards in Pyongyang carry e-mail addresses, albeit usually collective ones. A west European businessman says he is astonished by the speed with which his North Korean counterparts respond to his e-mails, leading him to wonder if teams of people are using the same name. This is, however, North Korea, and sometimes weeks go by in virtual silence.

In some places, North Korea’s internet economy seems to be overheating. Near the northern border, Chinese cell phones—and the prepaid phone cards needed to use them—are a hot black-market item, despite government efforts to ban them. The new web-enabled phones might soon give free access to the Chinese web which, for all its no-go areas, is a paradise of liberty compared with Kwangmyong. In this region, known for its casinos, online gambling sites are said to be increasingly active.

Last summer the police were reported to have cracked down on several illegal internet cafés which offered something more daring than the average chatting and dating. Despite the signs that North Korea’s web culture is ready to take off, internet-juche remains a reassuring form of control in the hermit regime.

Daily NK
Kim Young Jin
1/31/2007

The Daily NK had conducted commodity price research in northern and southern North Korea from the end of last year to this January. According to the research result, rice price, despite some regional difference, averaged around 1000 NK won per kilogram. The price of North Korea’s most fundamental grain differed based on local rice production and whether it was inland or border area.

In Sinuiju, a city bordered with Chinese Manchuria, residents enjoyed relatively low price of rice due to the city’s proximity to China and breadbasket of the country, Pyongan Province. Sinuiju’s rice price was as follows: North Korean rice 850 won per kg, South Korean one 870 per kg, and Chinese imports 800/kg. Other than rice, every item showed little increase in price except for pork meat (2500 won per kg).

Basic Prices – January 4, 2007
Rice (1kg): 
Sinuiju – 830 (produced in NK), 800(produced in China)
Kangdong – 750(produced in NK), 850 (produced in South Korea)
Kangdong hosts a military hosptial and military camp. Consequently, it maintains an excess supply of rice, making rice cheaper in Kangdong than in Sinuiju. 

Corn (1kg): Sinuiju – 340 (NK), 300 (China)
 
Pork (1kg): 2400~2500
 
An egg: 250
 
A chicken (2kg): 7000
 
Soy bean oil (1kg): 3300
 
Salt (1kg): 230
 
Wheat flour (1kg) 900
 
Diesel oil (1kg)/Gasoline (1kg) 2200 / 2700
 
Exchange rate (a dollar) 3,270 / 1Yuan = 425won 

In northernmost North Korea, Chongjin had had relatively high rice price. The port city close to Russia had been quarantined since outbreak of scarlet fever. In Chongjin, both North and South Korean rice cost around 1000 won/kg, and Chinese 900 won/kg.

The reason for stability of rice price around 1000 won/kg in North Korea is, in spite of what is happening outside the country, steady supply of the grain to meet next year’s demand. And moreover, stocking up or price regulations, which usually occur when shortage in rice production is expected, had not happened yet.

Given current rice circulation in private market, this spring would not be as bad as outsiders worry. Informers say that they could smuggle rice out of China whenever necessary.

Meanwhile, North Korea’s won had been weakened consistently. In second half of last year, market exchange rate was 2950 won per dollar; it is now 3270 won/ US dollar. Won per Chinese yuan has risen from 375 won/ 1yuan to 425 won/ yuan during the same time period.

In general raise in exchange rate forces commodities price to increase; however in North Korea, prices heavily depend on change in supply rate since the country is suffering ongoing shortage of it. For example, last year when the army started selling its gasoline stockpile, oil price fell from 3000 won/ kg to 2500-2600 won/kg in one month.

northern provinces prices for December 2006 
 
NK rice-1000
SK rice-1000
Chinese rice-900
 
Corn-340
 
Wheat flour-800
 
Pork (1kg)-2500
 
An egg-300
 
Cabbage-350
radish-200
Potato-250
 
Soy bean oil-3200
sugar-2200
seasoning-5000
 
Pepper paste-1500
 
Gasoline-3200
 
Socks-1000
There are much cheaper kind of socks, around 200won.
 
Sports shoes (produced in China)-4000
There are lots of different goods according to the qualities.
 
Headache specific- 10
 
Ballpointpen-300
pencil-100
The NK products cost 10 or 20 won
 
A note book-1000
There are price differences depending on the sizes of notebooks.
 
Land tax (per 4 sq. yds)-46
 
Exchange rate (a dollar)-3200
 
1 Yuan-148

Japan Focus (Hat Tip Gregor)
Ruediger Frank
1/31/2007

Abstract
The starting point of this paper is the assumption that North Korea is de facto a well-defined nation-state, home to a national economy and inhabited by individuals that bear the same basic economic and social characteristics as individuals elsewhere. Despite the obvious specifics of the economic system and institutional structure of the country, standard economic theory should be applicable to the question of North Korean economic development. The article seeks to prove this as broadly as possible, showing that economic theory as diverse as classical and neoclassical, Marxist, Keynesian, institutional, developmentalist, neo-liberal or structuralist, dependency analysis-based and many others, including regionally centered approaches, can be utilized to explain the North Korean case with useful results, although the latter will inevitably vary depending on the chosen framework. Without arguing against or in favor of any of the available theoretical methods, this article advocates further research on North Korea as another case of development in East Asia, rather than as a mystical exception to the rule. This is particularly important in light of the tendency to describe North Korea as unpredictable, bizarre, and incomprehensible. This is clearly not the case.

Full paper below the fold

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