Location differences of services and industry: A Central European dichotomy

In post-socialist spatial restructuring, over-industrialised economies experienced a period of intense tertiarisation and the decline of industrial employment. However, the role of services in this process shows strong sectoral and spatial differences. In addition to structural correction, tertiarisation may be interpreted as the bearer of economic modernisation, but also a symptom of weakness where services dominate due to an absence of economic alternatives. Advanced business services are strongly concentrated in central regions, while elsewhere economic growth is still mainly driven by industry, whose location shows high path-dependency going back to the quantitative and qualitative factor supply, as well as a broader societal and institutional background that encourages the reproduction of industrial milieus.Using empirical evidence from Central and South-Eastern European countries, the author examines how the sub-national location differences of services and industry reshape and recreate the region’s traditional centre–periphery differences: evidence points to differentiation between not only central and non-central regions, but also the Central and South-Eastern European group of new EU members and candidate states.