We went to Prague for a week in 2004 and there are plenty of shops. I can't recall any modern city centre malls but Prague is a medieval city. It had been preserved and not ruined as we are apt to do here.
There are many different shops around the city and it is just a matter of wandering around and finding them. The Jewish quarter in particular has many shops and that's not far from the Market Square. There are also many shops and modern stores near Wenceslas Square.
I think a general rule though is to say that the city centre contains the historic heart of Prague as well as restaurants and bars. The more general shops are a little further away from the centre but within easy walking distance.