The U.S. has been leading a world-wide campaign to pressure North Korea into giving up its nuclear arsenal through an increasingly stringent sanctions regime. Available evidence suggests it’s not working.

Economic indicators show day-to-day commerce in the country has remained resilient. And many residents, having lived through much harsher conditions in the 1990s, appear to be adapting as market forces take deeper root, according to three dozen defectors, humanitarian workers, government officials and other visitors interviewed...