Previous cups show that conquest brings extra-meadow gains to the nations that take the trophy. Exports could benefit Argentina, which has been mired in an economic crisis for decades.
Post-cup earnings
In the past 30 years, five countries have won the seven World Cups held in this period: Brazil (1994 and 2002), France (1998 and 2018), Italy (2006), Spain (2010) and Germany (2014).
In six of these seven countries, the country recorded an increase in the growth rate of gross domestic product (GDP) in the year of the invasion over the two years before and after.
In 1994, Brazil recorded a growth rate of 5.9%, much higher than in the two years before and after. The same thing happened in 2002, when the growth rate of 3.1% exceeded the 1.4% and 1.1% recorded in 2001 and 2003, respectively.
In 1998, when France won the World Cup for the first time, the economy of the country, which also hosted the event, grew by 3.6% – more than in 1997 and 1999. The French won again in 2018, but this time GDP growth was down from 2.3 % to 1.9% compared to the previous year.
Italy won the 2006 World Cup, a year in which its economy grew by 1.8%, surpassing the rates of 0.8% and 1.5% recorded in 2005 and 2007, respectively. Germany enjoyed similar success in its glory year, 2014. The German economy grew by 2.2%, up from 0.4% in 2013 and 1.5% in 2015.
Even Spain, which won the tournament in 2010 amid a major global recession triggered by a financial crisis, seemed to benefit from the World Cup bonus: Its economy grew 0.2% that year, up 4 percentage points from the previous year. 1 percentage point more than in 2011.
But will winning the World Cup be the real reason for this growth or is it just a coincidence? Provocative effect or “only” economy?
At the time of the 2014 World Cup, Forbes columnist Allen St. “In the months after winning the Cup, there appears to be a short-term increase in productivity,” John writes.
However, he added, “Think of it as the patriotic equivalent of the effect of eating a candy bar, with a short-lived energy spike followed by an energy depletion.”
Of course, this effect is easy to imagine. Bars and restaurants were filled to capacity for days and weeks after the victory. Managers try to channel players’ confidence and skill by launching daring goals they may not have done before.
However, what little academic data exists on the topic points in another direction. Research conducted by the University of Surrey in the UK ahead of this year’s World Cup found that jumps in gross domestic product after winning the Cup were attributed to increased exports, rather than domestic consumption or investment.
The study showed that there is an increase in GDP in the first two quarters after winning, when the winning country’s brand strength significantly increases the popularity of its exports.
“The evidence reinforces the idea that success in one of the most prestigious and sought-after international sporting competitions can influence the business cycle,” concludes Marco Melo, author of the study.
The research compared the growth data of the winning countries with those of the losers.
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