North Korea and South Korea, twins separated at birth, have provided a wonderful, natural economic experiment pitting state central planning versus free market.
quote: A Tale of Two Koreas
For the first 25 years after the split, both North and South Korea roughly quadrupled their respective GDPs. But after 1975, North Korea's economy flat-lined for 25 years, then sank back to its 1969 levels. South Korea's economy, however, continued to escalate dramatically. In 2008, South Korea reached a GDP of nearly $1 trillion, compared to North Korea's $25 million.
As Arthur Brooks observes in The Road to Freedom:
Many socialists in the West believed that the North's Stalinist system of central planning would prove more effective than the South’s market-based approach. We all know how things turned out on the Korean peninsula. Today, North Korea is horribly poor and its people are starving. It also has the distinction of being the least free country in the world. Meanwhile, South Korea is both the thirty-seventh freest country in the world and the thirteenth richest.