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Planning the end of planning

This surreptitious system of truck, barter and exchange might eventually be the kernel of a more dynamic market economy. But the breakdown of North Korea’s central planning is a mixed blessing. One of the few communist countries to liberalise its economy without a big drop in output was China. It did so by keeping its central plan in place long enough to grow out of it. In the early years of reform, households and firms kept their centrally allotted entitlements and obligations. But they were free to sell or buy anything extra for whatever they could get. This allowed prices to do their job of signalling scarcity and abundance, even as it avoided the disruptions and hardship suffered by other transition economies.
North Korea would profit from following China’s example, argues Gérard Roland of the University of California, Berkeley. (At the very least, households should be entitled to a ration of essential goods at controlled prices.) Before the North can make a successful transition to a market economy, therefore, it may have to revive something like its public distribution system. The country’s best route may lie in reviving a rudimentary plan.
The path to a market economy will no doubt be bumpy. South Korea’s communist sibling is both poorer and more populous than West Germany’s ever was. But as Messrs Funke, Strulik and Roland all point out, the Koreas have one advantage Germany lacked. They can learn from its example.

A. 어휘
surreptitious 內密(내밀)한, 간교한, 부정한. kernel 核(핵), 核心(핵심).
centrally allotted 중앙정부에서 할당된. entitlements 권리, 자격.
obligations 의무. scarcity 부족, 缺乏(결핍). abundance 豊富.(풍부).
disruptions 분열, 붕괴. transition 변천, 轉移(전이), 過渡期(과도기).
ration 배급량, 할당, 定額(정액). distribution system 배급제도.
rudimentary 근본의, 초보의, 미발달의. bumpy 울퉁불퉁한, 浮沈(부침)이 심한
sibling 형제자매.