Institutional Entrepreneurs in North Korea: Emerging Shadowy Private Enterprises Under Dire Economic Conditions

Abstract

This paper analyzes North Korea's private business entities that are considered to be "shadowy" for three reasons: First, shadowy private enterprises (SPEs) are "not officially recognized" as legitimate corporate entities by the government. Second, they are "not permitted to be registered" in the official enterprise list. Third, because of these two reasons, they are "ostensibly unidentified" under the country's socialist economy. The paper classifies SPEs into two categories: SPEs that are officially state-Owned enterprises (SOEs) but are private in nature (financed and managed by private individuals) and those emerging in newly created economic areas. As institutional entrepreneurs, SPEs represent the interests of various market forces, leverage resources to develop market institutions, and contribute to the transformation of economic institutions. This article was funded by Korea University.