The Peterson Institute for International Economics is a private, nonprofit, nonpartisan
research institution devoted to the study of international economic policy. More › ›

Keep up to date with Peterson Institute publications, events, and interviews with a subscription to our email newsletter.

Search Publications and Events

Use filters to narrow your search.

| More

POLICY BRIEF 10-1

The Winter of Their Discontent: Pyongyang Attacks the Market

by Stephan Haggard, University of California, San Diego
and Marcus Noland, Peterson Institute for International Economics

Listen to related interview

North Korea's confiscatory currency reform and the subsequent ban on the use of foreign currencies are economically misguided policies and will result in the reduction of North Korean residents' welfare. These developments come at an inopportune time with the country facing economic stagnation, spiraling prices, and a resurgence of food shortages. North Korea has made no attempt to veil its motivations: strengthening the socialist economy by directly attacking the market and the independence from state control that it represents. Stephan Haggard and Marcus Noland posit that these policies will require a ratcheting up of already high levels of repression, and as long as the state lacks the resources and capacity to provide goods to its citizens, the effort is unlikely to significantly contribute to the stated goal of rebuilding socialism or eradicating the market. The open questions are whether the policies will be reversed and whether they have sown such discontent as to threaten political stability. The survival instincts of North Korea's determined, resilient citizens may very well make the market a locus of precisely the political activity the regime seeks to thwart.

View full document [pdf]

subscribe

Search Publications and Events