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In this short paper there will be introduced the stream of economic theory labeled as the New Economic Geography (NEG) & derived the core-periphery model, a flagship of the NEG. It is a model of two regions with imperfect competition & increasing returns to scale, where some properties of the model contrast certain features of basic neoclassic models of regional economics & international trade. The role of monopolistic competition & increasing returns to scale opens the possibility of highly nonlinear effects of production location with respect to barriers of trade. I analyze main mechanisms of the model & discuss the relevance of the NEG for economic policy in the context of European economic integration. Graphs, References. Adapted from the source document.

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The social transformation in post- totalitarian countries is characterized by extraordinarily dynamic differentiation tendencies. With respect to social groups & territorial communities, these tendencies differ or are even contradictory, resulting in an internal social & territorial polarization in the national systems concerned. These polarization processes are, on the one hand, a reaction to the equalizing tendencies in communist countries, and, on the other hand, are the result of the need for qualitative changes to social structures. One such structure is the regional organization of society, which owing to the heterogeneous nature of the conditions it exists in has very specific features. Essentially it is the environmental organization of society, where the effects of social & natural factors are combined. Consequently, there is typically a higher level of territorial inequality in the distribution of economic activities than in social distribution, and, by contrast, less variability of geographical differentiation than social differentiation. These features are demonstrated in an empirical analysis of the current development in the Czech Republic, wherein a distinction is made between two ways of assessing regional distribution. First, there is the assessment of differentiation of the territorial intensity of economic activities (economic aggregate/km2). Second, there is the assessment of relative economic & social development (economic aggregate/inhabitant). Despite the differences in the level & variability of the two types of regional differentiation, there are similar trends in their development, heading towards greater inequalities.