Patricia S. Pollard

English

Research Papers in Economics

World Cup Winners and Economic Growth
Real GDP growth rate
Year Winning team Same year Next year Period
1998 France ↑ ↑ ↓ ↓ ↑ ↑
1994 Brazil ↑ ↑ ↓ ↓ ↑ ↑
1990 West Germany ↑ ↑ ↓ ↓ ↓ ↓
1986 Argentina ↑ ↑ ↓ ↓ ↓ ↓
1982 Italy ↓ ↓ ↑ ↑ ↓ ↓
1978 Argentina ↓ ↓ ↑ ↑ ↑ ↑
1974 West Germany ↓ ↓ ↓ ↓ ↓ ↓
1970 Brazil ↓ ↓ ↑ ↑ ↑ ↑
1966 England ↓ ↓ ↑ ↑ ↓ ↓
1962 Brazil ↓ ↓ ↓ ↓ NA
SOURCES: OECD (France and West Germany) and World Bank, World
Development Indicators (all other countries).
GROOOWWWTH!
Economic growth in France was sluggish between 1994
and 1997, averaging 1.6 percent per year. However, growth
accelerated to 3.1 percent per year between 1998 and
2001, spurred by a rise in business investment and domes-
tic demand. Structural reforms and low interest rates due
to low inflation and fiscal improvements are generally
cited as factors responsible for the turnaround. The turn-
ing point for the French economy, 1998, is also the year
France won the FØdØration Internationale de Football
Association (FIFA) World Cup (football, of course, being
the nearly worldwide term for soccer). As the Financial
Times recently claimed, ￿the win inspired an optimism
that boosted France￿s fledgling economic recovery.￿1
Does the World Cup affect economic growth? Can the
country that wins the 2002 World Cup expect a boost to
its economy? Examining the previous ten World Cup
winners (1962 to 1998) provides mixed evidence. As
shown in the table, only four of these ten had an increase
in the growth rate of real GDP in the year of the cham-
pionship (relative to the growth rate in the previous year).
Interestingly, these were the four most recent winners.
Since the World Cup is held in the late second or
early third quarter, any effect on annual economic growth
may not be seen until the following year. Comparing the
growth rate of real GDP in the year of the World Cup
victory with the growth rate the next year indicates the
following: four of the six countries that did not see an
acceleration in their rate of economic growth in the year
they won the World Cup did experience a rise in the fol-
lowing year. 
These results provide some support for an association
between a World Cup victory and a boost to economic
growth. However, all of the countries whose rate of econ-
omic growth accelerated in their championship year saw
a drop in their growth rate the following year. Does this
imply that any acceleration in growth is short-lived?
Perhaps. The last column in the table compares a country￿s
growth rate of output in two four-year periods: (i) the
year of the previous World Cup to the year before their
World Cup victory with (ii) the year of their victory to
the year prior to the next World Cup (e.g., 1994-97 and
1998-2001 for France). Half of the countries whose
growth rates rose in the championship year or the next
year had a higher growth rate in the four-year period
following the World Cup victory than in the previous
four-year period.
But a country should consider this word of caution
before it invests in the development of a national football
program to raise its growth rate of output: Brazil, the
country with the most World Cup victories, has struggled
economically compared with a country such as South
Korea, which until this year had never won a World Cup
game. Real GDP per capita was $1,742 in Brazil in 1960
and $1,256 in South Korea. In 1999 real per capita GDP
in Brazil was less than half that in South Korea ($4,479
compared with $12,086, respectively). Investment in
physical and human capital (education) in conjunction
with sound economic policies remains the most reliable
means by which to raise economic growth.
￿Patricia S. Pollard
1Minder, Raphael. ￿French Despair As Soccer Team Meets Its Waterloo.￿
Financial Times, 12 June 2002.
Annual Edition July 2002
Views expressed do not necessarily reflect official positions of the Federal Reserve System.
research.stlouisfed.org
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