ABSTRACT
This chapter deals with a brief discussion of the economic fault lines which exist between the European core and its peripheries. It examines briefly the theories relating to integration and enlargement. The chapter discusses the Luxembourg Declaration, and the convergence of European Community-European Free Trade Association policy-making in the wake of the Single European Act and the Single Internal Market programme. It outlines a cost/benefit analysis of the implications of European Union (EU) enlargement from 12 to 15 member states, with reference to the impact of the European Economic Area, together with an examination of the problems associated with Economic and Monetary Union in an expanded EU. The chapter suggests that, in the absence of sui generis logics of integration, the process of enlargement and the development of new peripheries, in combination with dirigiste integration 'from above' are more likely to prompt fragmentation of the European political economy than convergence.
