ABSTRACT
During the last decade, the integration of Central and East European countries (CEECs) with the world economy, and, in particular, with the European Union (EU) has increased via trade and foreign investments (as documented in Chapter 1 of this book) and has most likely caused a reallocation of resources across sectors and regions. Sectoral shifts at the national level in the CEECs have been analyzed frequently (see Landesmann and Stehrer, 2002), but the reallocation of resources across regions requires more in-depth investigation. What impact has increased economic integration with the European Union (EU) had on the location of industrial activity in accession countries? Have patterns of regional specialization and geographical concentration of industries changed over the last decade? Does greater specialization imply greater polarization?
