Periodic layered metal-dielectric nanostructures are used in subwavelength imaging, invisibility cloaking, nano-lithography
and optical nanocircuitry. These optical metamaterials are usually described by local effective
medium model if their periods are much smaller than a wavelength. Our studies show that even under such
strict conditions the metamaterials are nonlocal and exhibit strong spatial dispersion effects. The uniaxial media
support two or more extraordinary waves in certain directions while the local effective model predicts only one.
The strong spatial dispersion is caused by surface plasmon polariton modes at the interfaces between metal and
dielectric layers.A
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