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05/28/2026 | Press release | Distributed by Public on 05/28/2026 09:04

In the World’s Economic “Black Holes,” Data Still Leaks Out

Published Date

May 28, 2026

Article Content

North Korea is the blackest of economic black holes. Even a basic question like "is the economy shrinking or expanding?" can be difficult to answer. The country does not publish reliable statistics. It sharply restricts outside access and treats trade data as a state secret.

Yet even highly opaque economies leave detectable traces. The challenge is learning how to interpret those indirect signals.

In a paper published in World Development, researchers from the University of California San Diego and Ewha Womans University outline a toolkit for reconstructing economic activity in places where - by design or circumstance - reliable official information barely exists.

"The problem is much broader than North Korea," said co-author Stephan Haggard, director emeritus of the Korea-Pacific Program at the UC San Diego School of Global Policy and Strategy and Lawrence and Sallye Krause Distinguished Professor Emeritus. "Economic black holes emerge in many different contexts: authoritarian states that tightly control information, war zones where normal data collection collapses, and fragile or remote regions where governments lack the capacity to gather reliable statistics."

North Korea, the researchers argue, represents the most extreme version of the problem - making it a useful test case for methods that can also be applied elsewhere.

Reconstructing Hidden Economies with "Forensic Economics"

The paper frames the work of investigating economic black holes as a form of "forensic economics": reconstructing hidden realities from leaks and fragments.

The researchers' toolkit in this case includes satellite imagery, humanitarian agency data, "mirror statistics" from trade partners, price monitoring, refugee surveys, and text mining.

No single method is enough on its own, the authors argue. The most reliable insights emerge through triangulation - combining multiple imperfect sources to build a more credible picture.

"We know more than what the general public might anticipate," said co-author Munseob Lee, the Lawrence B. and Sallye K. Krause Chair in Korean Studies at the UC San Diego School of Global Policy and Strategy and director of the Korea-Pacific Program. "Even though the data are noisy and imperfect, by combining multiple methodologies and cross-checking them against each other, we can still learn a great deal."

Stephan Haggard,, UC San Diego School of Global Policy and Strategy.

Some of the methods - like satellite imagery of nighttime lights - are now widely used across development economics and conflict analysis. Other methods are more unusual.

Prices as Signals

One approach relies on clandestine price reporting inside North Korea.

Networks of surveyors inside the country collect prices for goods such as rice, refrigerators and fuel, then transmit the information (at considerable personal risk) through Chinese cellphone networks accessible near the border. The data is compiled by private firms founded by North Korean defectors in South Korea and ultimately reaches governments, researchers and policy analysts trying to understand conditions inside the country.

The reported prices can reveal far more than the cost of consumer goods. Researchers can use fluctuations to infer sanctions impacts, for instance, and trade relationships.

"We know more than what the general public might anticipate. Even though the data are noisy and imperfect, by combining multiple methodologies and cross-checking them against each other, we can still learn a great deal." - Munseob Lee

"If the prices of sanctioned goods suddenly change, or if Russian-produced products begin appearing in markets, those become signals," said Kyoochul Kim of Ewha Womans University, one of the paper's co-authors who was a UC San Diego visiting scholar from 2023-2024. "We can begin to understand whether sanctions are working or whether trade with certain partners is increasing."

Reading Between the Propaganda Lines

Another method mines North Korea's own propaganda apparatus for unintended clues.

State newspapers routinely publish reports on factory visits by leader Kim Jong Un and other officials, often naming industrial facilities and their locations for propaganda purposes. Researchers can combine those references with satellite imagery and other datasets to map industrial activity and government priorities over time.

The researchers argue that systems designed to tightly control information can inadvertently create new forms of observable data.

Beyond North Korea

The toolkit applies wherever direct reporting is difficult or dangerous. Sanctions-hit Iran, wartime Russia and Ukraine, and conflict zones across Africa, the Middle East and Latin America all pose versions of the same challenge.

Advances in artificial intelligence and large language models are also expanding what's possible, making it easier to extract structured data from propaganda, leaked documents and other fragmented sources.

"I think these methods can be useful beyond economists," said Lee. "There are many situations where researchers, journalists or policymakers are trying to understand places where reliable information is very limited. The black holes don't need to stay totally dark."

Munseob Lee, UC San Diego School of Global Policy and Strategy.
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