Economic isolation in this study refers to restrictions on the transportation of people and goods; foreign trade and investment; and participation in the international community: Since the division of the island in 1974, Turkish Cypriots are living in almost full economic isolation in the North. To calculate the effect of the isolation has had on the economic development of the Turkish Cypriots, we introduce a novel approach. We compare the per capita incomes in the North and the South, and based on the per capita income differences we calculate the total costs of the economic isolation. Our calculations show that between 1977 and 2006, the lost income was $25 billion. This corresponds to $112 thousand per Turkish Cypriot living in the North.