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The (Non) Impact of UN Sanctions on North Korea

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  • Marcus Noland

    ()
    (East-West Center & Peterson Institute of International Economics)

Abstract

This study finds that North Korea's nuclear test and the imposition of UN Security Council sanctions have had no perceptible effect on trade with its two largest partners, China and South Korea. Before North Korea conducted an underground nuclear test, it was widely believed that such an event would have cataclysmic diplomatic ramifications. However, beginning with visual inspection of data and ending with time-series models, no evidence is found to support the notion that these events have had any effect on North Korea's trade with its two principal partners. In retrospect, North Korea may have calculated quite correctly that the direct penalties for establishing itself as a nuclear power would be modest (or, alternatively, put such a high value on demonstrating its nuclear capability that it outweighed the downside risks however large). If sanctions are to deter behavior in the future, they will have to be much more enthusiastically implemented.

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Bibliographic Info

Paper provided by East-West Center, Economics Study Area in its series Economics Study Area Working Papers with number 98.

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Length: pages 27
Date of creation: Feb 2009
Date of revision:
Handle: RePEc:ewc:wpaper:wp98

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