This is interesting:
Estimates of what it will cost South Koreans to absorb North Korea are now over five trillion dollars. Then there was the fact that Germany had a GDP four times that of South Korea, meaning that the average South Korean will have to pay ten times what the average West German paid to rebuild their lesser half. This could cost South Koreans up to ten percent of their GDP for a decade or more. Many South Koreans fear that rebuilding the north could wreck the South Korean economy. No one knows, and everyone is scared. But someone will have to pay, and the most likely candidate is the South Korean taxpayer. Unless, of course, China is allowed to take over. This is something China is not only willing to do but is kind of insisting on.
Strategypage also writes that China would have to do something with the police, bureaucrats, and military.
The bureaucrats would stay--at least initially, even if under Chinese supervision. The police would have to stay. The spies would have to be retained and otherwise dealt with carefully to keep them from threatening law and order.
And the large army can't just be set loose. Much would be retained. But the military is huge.
If I was in charge of the Chinese effort to absorb North Korea--even if it is at a technical distance as with Hong Kong--I'd tell the North Koreans that China would take a large chunk of the North Korean army and then send them as battalions to bolster PLA ground units facing Taiwan, Myanmar (Burma), Laos, and Vietnam, where they could be used as cannon fodder in case of a war.
I'd send a bunch to the far west battling Moslem insurgents and terrorists, where the Chinese can get the North Korean troops to do the dirty work while the Chinese security forces get to be the "good cops" in the routine.
I'd also send North Korean troops to Tibet for similar occupation duty and for use near the front with India for the cannon fodder role in case of war.
Remember, when China intervened in the Korean War, the communists sent defeated Nationalist troops to that war where China could kill them off to keep them from being a danger to the Communist Party while killing off some Americans and South Koreans and other UN coalition troops.
So why wouldn't China prevent the unneeded North Korean troops from threatening a puppet-led government while putting them to use?
As for South Korea, if they are so understanding about China's need for a buffer zone, would South Korea really be content to have Chinese artillery replace (or just control) North Korean artillery dug in within range of their capital, Seoul?
South Korea could limit their costs and protect their capital by insisting that the DMZ be moved north--but well south of North Korea's capital, Pyongyang--so both China and South Korea get a better buffer zone.
I long ago gave up trying to anticipate the collapse of the North Korean state or country. But it is definitely going that way as a number of trends indicate. And there is this:
Another sign that there is less respect for the government in North Korea is the two months of persistent rumors that there is an active plot to assassinate North Korean leader Kim Jong Un. This began when an airport (Wonsan International) visit by Kim Jong Un was cancelled at the last minute when a second security check found a quantity of explosives hidden in the ceiling. Naturally the secret police began a nationwide investigation which, with lesser intensity, continues. No official comments come from the government, which tends to keep the rumors flowing. What bothers the government about this is that many North Koreans are hoping that the assassins, not the investigators, succeed.
I suspect in a collapse scenario up north that South Korean and American troops will move north to carve out a no-launch zone to protect the South Korean capital; and to put boots on the ground at key North Korean nuclear facilities (after the intense bombing while the ground troops get there).
The question is whether South Korean troops stay to keep a buffer zone. They should. Will China cooperate with that objective?