When it comes to the World Cup, one would think that the winning country would benefit the most- in terms of recognition, bragging rights, attention, tourism in the future, and so on. However, an interesting article in Forbes magazine suggests that the winner may not really take all when it comes to economic growth following the game.
In a gathering of data by the World Bank, results yielded that in six out of the past seven world cups, the winning country saw a decline in their gross domestic product following the year of their win. This interesting pattern dates back to 1986, when Argentina won the cup, and has continued every year, aside from Spain’s win in 2010. That being said, the only growth Spain saw in GDP was by 0.1%, much lower than one would expect for the country that had just won the world cup.
Worse yet, is that out of the countries that did experience a decline in GDP following their world-cup win, 5 out the 7 total experienced a continued decline in the second year after their winning of the world cup. Interestingly enough, it seems that this trend is already on its way to taking hold once again. Between this year’s finalists, Argentina is already seeing an improvement in their economy- seeing a 3.0% growth in 2013, while Germany only saw a 0.4% increase that same year.
Experts are speculating on why this is the case, and are quick to say that only 7 years of observation is not enough data to solidify this pattern. Some economists believe that the time the people of a country spend watching the world cup results in a detriment of the economy, as people are not focused on their careers and their daily lives. That being said, this does not seem like something that could be that severely detrimental to the economy, and for such an extended period of time. Not to mention, this trend is solely relative to the World Cup- it is not seen during the Olympics, NBA finals, the Superbowl, or any other widely-viewed sporting events.
Only time will tell when it comes to learning more about this pattern and its causes. To learn more about this interesting trend, check out the Forbes article here.