The year 2002 should see the end of the negotiating process for the European Union (EU) enlargement that will lead within two years to full membership for eight out of the ten Central-Eastern European Countries (CEECs) candidate for accession. This will be the final step of an integration process that started in 1989, with the beginning of the transition in the CEECs.

Trade liberalization was the first form of integration between the EU and the CEECs. But how has trade liberalization been changing the configuration of the patterns of comparative advantages of the countries involved in the process? What could be the effects on labour-abundant members of opening up the Union to new labour-abundant members? Do countries involved show a tendency to seek competitiveness through product differentiation or, rather, through quality differentiation?

Along with trade integration, prominent is the issue of production integration. More specifically, which were the characteristics of the process through which EU-based firms were taking advantage of the sudden opportunity offered by the possibility to access large, under-utilized productive capacity and relatively high-skilled labour force at relatively low costs? Questions in such realm abound: What configuration of international division of labour is emerging from the process? What are the industries and the countries most involved in the process? What would be the effects of these "production networks" on the intemational competitiveness of EU based firms? And those on labour demand in the EU-member countries?

The papers collected in this book present significant evidence on the issues raised by the above questions. They are the main results of a two-year long research program on both features and effects of the process of economic integration between the EU and the CEECs, jointly developed by researchers at the Politecnico di Milano, the Università di Parma and the Università Carlo Cattaneo-LIUC.

Salvatore Baldone, Fabio Sdogati and Lucia Tajoli are respectively Professor of Economics, Associate Professor of International Economics and Associate Professor of Economics, Department of Management, Economics and Industrial Engineering, Politecnico di Milano.