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Chapter 5 - The Emergence of a Hidden Market Economy in North Korea

Published online by Cambridge University Press:  07 May 2025

Ahlam Lee
By
Ahlam Lee
Ahlam Lee
Affiliation:
Xavier University
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Summary

Since the North Korean Famine in the mid-1990s, survivors have turned to cross-border activities for sustenance, evolving into commercial activities in black markets known as jangmadang. With the collapse of the socialist Public Distribution System, the majority of North Koreans now rely on these black markets to earn money and meet their basic needs. However, such commercial activities for personal gain are illegal in the country, symbolizing the emergence of North Korea’s hidden market economy. This hidden economy is characterized by various types of “shadowy private enterprises (SPEs),” ranging from entities officially registered as state-owned enterprises but run by private individuals to home-based enterprises. These SPEs sustain their operations and evade punishment by bribing bureaucrats. However, systematic corruption poses threats to the survival, safety, and well-being of marginalized groups who struggle to pay bribes, exacerbating inequality between privileged and unprivileged segments of society. Consequently, the hidden economy engenders various forms of competition, spanning from market competition to an invisible competition for safety and wellbeing.

Keywords

competitionNorth Koreablack marketGreat Faminebribery
Type
Chapter
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Questioning Conventional Assumptions of Competition Dynamics , pp. 121 - 140
Publisher: Cambridge University Press
Print publication year: 2025

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