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A review of the basic ideas and techniques of the spectral density-functional theory is presented. This method is currently used for electronic structure calculations of strongly correlated materials where the one-electron description breaks down. The method is illustrated with several examples where interactions play a dominant role: systems near metal-insulator transitions, systems near volume collapse transitions, and systems with local moments.

Using a combination of local-spin-density and Hubbard 1 approximations, we study the mechanism of exchange interaction in EuX (X = O, S, Se and Te). We reproduce known experimental results with regard to bulk modulus, critical pressure for structural phase transition, magnetic ordering temperature, spin-wave dispersions, as well as momentum-and temperature-dependent band shift. Our numerical results show a pressure-induced competition between the hybridization-enhanced exchange interaction and Kondo-like coupling in EuO. Possible ways to enhance T c are discussed.