Towards a Political Analysis of Markets in North Korea

Abstract

There are two ways to analyze the market in North Korea. Economic analyses comprise the study of marketization from below, the dual economy (formal and informal), and market expansion as threat to the planned system and the regime. In contrast, political analyses are concerned with the economic structure as a reflection of the distribution of political power. These two approaches to analysis of market in North Korea are compared. In contrast to the economic analysis, the political analysis asserts the following: Market expansion has been boosted by trading companies run by powerful military and party organizations and the cabinet, and has contributed to regime maintenance and the regimes grip on the economy; The state intervened regularly in the process of market expansion and shaped the latter in favor of rent extraction; With market expansion, the North Korean economy can be characterized as a hybrid of state and market.