December 7, 2012 3:22PM 

# North Korea’s Hyperinflation Legacy, Part II 

By [Steve H. Hanke](https://www.cato.org/people/steve-h-hanke) 

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Following North Korean supreme leader Kim Jong-il’s death last December, many around [the world had high hopes](http://www.washingtonpost.com/world/asia_pacific/with-elder-kims-death-some-see-window-for-change-in-north-korea/2011/12/19/gIQAdjIM4O_story_1.html) that his successor (and son), Kim Jong-un, would launch much-needed economic and political change. Unfortunately, in the months since the new supreme leader assumed power, [little has changed for North Koreans](http://www.nytimes.com/2012/10/15/world/asia/north-koreans-say-life-has-not-improved.html?pagewanted=1&ref=northkorea) outside of the small, communist upper class. The failed communist state has not delivered on its [advertised economic reforms](http://www.bbc.co.uk/news/world-asia-19697369).

One thing it has delivered, however, is weapons, which have flowed through its [illegal arms-trafficking pipelines](http://online.wsj.com/article/SB10001424127887323830404578144981537771060.html). And, if that’s not enough, North Korea is planning [another missile test](http://www.nytimes.com/2012/12/02/world/asia/north-korea-is-preparing-to-launch-another-long-range-rocket.html) in the near future. But, as it turns out, the only thing that is certain to blast off is inflation.

In [my recent blog post](https://www.cato.org/north-koreas-hyperinflation-legacy/), I pointed out that one of North Korea’s communist legacies is hyperinflation (in addition to [starvation](http://www.cbsnews.com/8301-18560_162-57556456/horrors-revealed-at-north-korean-prison-camp/)). Indeed, [hyperinflation](https://www.cato.org/publications/working-paper/world-hyperinflations) may soon [plague North Korea once again](http://www.piie.com/blogs/nk/?p=7418).

From what [little data are available](http://www.dailynk.com/english/market.php), it would appear that, in the span of six months, the price of rice has increased by nearly 130%. This is par for the course in North Korea, where the price of rice has increased by roughly 28,500% over the last three years (see the chart below).

![Media Name: NK-RICE.png](/sites/cato.org/files/styles/pubs_2x/public/wp-content/uploads/NK-RICE.png?itok=zoscCnN9) 

While the North Korean government worries about rocket launches and how to supply Syria with weapons, and while its [archaeologists “discover” ancient unicorn lairs](http://www.telegraph.co.uk/news/worldnews/asia/northkorea/9714907/North-Korea-archaeologists-report-unbelievable-discovery-of-unicorn-lair.html), its citizens’ food bowls are becoming quite expensive to fill. The supreme leader’s priorities, it would seem, are supremely out of whack.

##### Related Tags 

[Defense and Foreign Policy](https://www.cato.org/defense-foreign-policy), [Inflation](https://www.cato.org/inflation) 

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