A Socialist Market Economy in North Korea? Systemic Restrictions and a Quantitative Analysis
The DPRK Briefing Book. Economy, pp. 1-24 (2003)
25 Pages Posted: 13 Dec 2016
Date Written: 2003
The paper deals with the question of economic reforms in North Korea. In the first, theoretical part, it is attempted to highlight the serious restrictions for a clear-cut decision between the old system of state-controlled procurement and distribution on one side and a market economy on the other, offering a hybrid solution to the occurring dilemma. In the second part, the price reforms of July 2002 are analyzed quantitatively as an empirical case study, including their impact on purchasing power, savings, fiscal policy, inflation and their distributive effects. This factual evidence is supplemented by a third part, in which the theoretical and ideological attempts of North Korea to bring the changes in line with its official ideology are explored. In the final analysis, the price reforms are put in the context of a broad North Korean reform initiative, resulting in important policy implications for the international community.
Keywords: North Korea
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