The rise of markets in North Korea’s lies at the root of all the country’s economic development over the past few years

See Shopping in Pyongyang, and Other Adventures in North Korean Capitalism by Travis Jeppesen in The NY Times. Excerpts:

"Usually translated as “market grounds,” jangmadang is the word for the unofficial markets that emerged during the Arduous March, which is the regime’s official name for the famine that blighted the country throughout the middle and late 1990s. These were illegal markets, to begin with, that sprang up as a result of the collapse of the public food-distribution system that all North Koreans had previously relied on for their monthly rations. During the later years of Kim Jong-il’s reign, the government began to grudgingly accept their existence and took steps toward regulating them: charging rent for stalls, controlling prices and monitoring what goods were for sale. Under Kim Jong-un, the restrictions against this form of private enterprise have been all but lifted, and jangmadang has transcended the cramped market stalls of its birth to refer to the vast array of legal, illegal and semi-legal markets that exist for all sorts of goods in North Korea. Among recent defectors and expat residents, it is said that now, as long as you have money, you can buy anything you want in North Korea. But since the government still hasn’t figured out a way of publicly reconciling with this nascent form of capitalism, it was considered taboo to discuss the jangmadang with foreigners.

Which is a shame, because the rise of the jangmadang is arguably the most significant milestone in North Korea’s recent history. It lies at the root of all the country’s economic development over the past few years."

"With food scarce and the government unable to provide through its rationing program, North Koreans began turning away from the official, centrally planned economy. Markets sprang up all over the country, selling everything from food, cigarettes and household goods to illegal foreign media. According to Daniel Tudor and James Pearson’s book “North Korea Confidential,” the stalls were generally operated by middle-aged married women who were compelled to pay a “stall tax” to their local party cadre, “making the state complicit in marketization” — uncomfortably so. In 2009, under Kim Jong-il, the government implemented a disastrous currency reform, tried to close down the markets and forbade market activity within the country. This resulted in wide public discontent, and a high-ranking Workers’ Party official was executed as a scapegoat for the government’s decision. Still, the regime had failed in its promise to feed its citizens, and the gray markets of the jangmadang had, to some extent, filled in the gaps."

"According to one survey, some 90 percent of all household expenditures are said to take place in these markets; they are so pervasive that people speak of a Jangmadang Generation that grew up knowing nothing else. Under Kim Jong-un, market activities have not only been tolerated; they have slowly crept into the official sector, as I witnessed firsthand in my visits to the country."

"The South Korean economist Byung-Yeon Kim is among the first to offer hard data about what this transformation looks like, in his 2017 book, “Unveiling the North Korean Economy.” The average worker in North Korea’s informal economy, Kim reports, earns 80 times more than at an official job. Approximately 23 percent of employees at state-run enterprises are simultaneously involved with some unofficial form of business. At least 58 percent of all companies in North Korea employ so-called 8/3 workers, who pay a fee in order to be absent from work and engage in unofficial market activities; these funds are an important form of revenue for these companies, helping them to continue paying the salaries of their regular employees."

"“The socialist economic system of North Korea has virtually collapsed,” Byung-Yeon Kim wrote."

"the state had issued new rules, lifting restrictions on the utilization of “order contracts,” so long as it agrees with the state’s objectives. Order contracts, Ward explained on a recent podcast, involve state-owned enterprises setting their own prices in consultation with customers. They are, in other words, market forces"