Few topics seem to provoke emotions in the West like North Korea does. The reasons include the perspective that this is one of the last remaining bastions of a system that has been fought ferociously and finally defeated during the Cold War. Eastern Europe has transformed itself completely. The Soviet Union is gone. Even China has changed beyond recognition. But North Korea persists, despite all its obvious systemic deficiencies and a list of problems that would easily go beyond the scope of this review.
The causes of this stubborn refusal to collapse and the question of how long this economy will survive are the core themes of the book. It is a collection of essays, which naturally entails a number of strengths and weaknesses. To start with the former, there is little of a consistent analytical framework applied throughout, there is some overlapping contents, and most of the chapters have in their original form been written well before the publication date of the book. However, the strength of the volume is exactly this diversity and the chance to update work that has been done a while ago. Eberstadt is one of the few authors who have written about the topic well before the current hype has broken out in the context of the nuclear development and George W. Bush's War on Terror. So it is useful both for the long-term students of the North Korean economy to be able to revisit his earlier pieces and see them put together in a certain context, and for the newcomers who might have missed his earlier publications.
After setting the tone in the first, overview-type chapter there follows an essay on North Korea(n) statistics. As little of substance is available directly, indirect methods have to be used. The application of mirror statistics is demonstrated in Chapters 3 and 4 regarding trade in capital goods as well as food, energy and transport equipment. Eberstadt identifies interlocking crises of a systemic nature that bear similarities with the First Republic (1948–1960) in South Korea. In Chapter 5, the author compares the development strategies of North and South Korea which, not surprisingly, ends clearly in favor of Seoul.
Chapter 6 is devoted to the prospects of the sunshine policy, a now abandoned approach by Seoul that decoupled cooperation with Pyongyang from the strict notions of reciprocity and causality that prevailed before. Eberstadt is very critical and regards that policy as naive and not being capable of delivering the expected results. Some readers will miss a deeper discussion of the internal and ideological effects of expanded economic cooperation with the enemy. Chapter 7 explores the options for economic recovery in the DPRK. Consistent with the general tone of his book, the author is pessimistic and predicts a persistent dependency on international assistance. He does not discuss the varying implications of changing sources of such assistance—for example a switch from South Korea to China.
The final three chapters in one way or the other deal with the same topic—North Korean reform, its likeliness, possible trajectories, connection to security policy. The author concludes by mapping out a future scenario for reform that he regards as unlikely to be applied by the Pyongyang leadership. He characterizes North Korea a “muddling through” but always being just a step away from catastrophe.
Responsibility for the sorry state of North Korea's economy is assigned entirely to the Pyongyang leadership. Critics will agree but counter by arguing that if regime survival is the top priority, then some options simply do not exist for political reasons although they might make sense economically. It can also be debated whether the nuclear program has to be seen entirely as a cost factor. Political considerations aside, at least two arguments come to mind regarding economic benefits emerging from the program. These include possible reduced costs for maintaining a modern conventional military, and the income from assistance etc. that is generated by using the high international attention that to a large degree depends on North Korea being a nuclear state. It is also questionable to present North Korea's economic development—in particular what the author calls the “parabolic trajectory” (p. 151) as unique, as the latter could in principle be observed in most socialist countries. Therefore, interpretations and conclusions will, as always, vary.
It is nevertheless fair to say that the book provides an important contribution to the field. It has its edges and a clear message. Policy makers will value the book as providing insights and arguments for their policies; academics and students will appreciate the many bold statements that invite a critical and productive discussion.
