What do we know about poverty in North Korea?

Reliable quantitative information on the North Korean economy is extremely scarce. In particular, reliable income per capita and poverty figures for the country are not available. In this contribution, we provide for the first time estimates of absolute poverty rates in North Korean subnational regions based on the combination of innovative remote-sensed night-time light intensity data (monthly information for built areas) with estimated income distributions. Our results, which are robust to the use of different methods to approximate the income distribution in the country, indicate that the share of persons living in extreme poverty in North Korea may be larger than previously thought. We estimate a poverty rate for the country of around 60% in 2018 and a high volatility in the dynamics of income at the national level in North Korea for the period 2012-2018. Income per capita estimates tend to decline significantly from 2012 to 2015 and present a recovery since 2016. The subnational estimates of income and poverty reveal a change in relative dynamics since the second half of the 2012-2018 period. The first part of the period is dominated by divergent dynamics in income across regions, while the second half reveals convergence in regional income.

Jesús Crespo Cuaresma, Olha Danylo, Steffen Fritz, Martin Hofer, Homi Kharas, Juan Carlos Laso Bayas