Mapping COVID-19’s economic impact in North Korea using nightlight satellite data

Abstract

While the negative economic shock resulting from the COVID-19 pandemic can be analyzed for most countries using publicly accessible economic data, no widely accessible data is available for North Korea, one of the most economically isolated countries in the world. This article investigates the economic impacts of COVID-19 in North Korea by performing a twoway fixed effects panel regression analysis using nighttime satellite data from publicly available Visible Infrared Imaging Radiometer Suite (VIIRS) Day/Night Band (DNB) monthly composites from January 2020 to January 2022, which have been shown in previous studies as a reliable proxy for economic activity. This article hypothesizes that 1) there will be a general decrease in nightlight intensity in North Korea due to the COVID-19 pandemic; 2) as the distance from Pyongyang increases, changes in average district nightlight intensity will trend negatively during the analysis period; 3) border districts will see comparative increases in nightlight intensity compared to non-border districts; and 4) districts focused in manufacturing, nuclear weapons development, chemical weapons development and districts with missile launch sites will see comparative decreases in nightlight intensity compared to districts not focused in these sectors, while the opposite will hold for districts focused in agriculture and mining. This article finds an increase in nightlight intensity in Pyongyang and nearby regions during the analysis period; negatively trending changes in average nightlight intensity as the distance from Pyongyang increases; an increase in nightlight intensity for districts bordering China, districts focused on mining, and districts with known chemical and nuclear development sites; and a decrease in nightlight intensity for manufacturing-focused districts and districts with known missile launch sites. These results imply that the Democratic People’s Republic of Korea (DPRK) redistributed economic resources towards Pyongyang, urban areas, and weapons development during the pandemic, likely at the expense of rural, agricultural districts and regions farther from the capital.