The Long-Run Impacts of the World Cup

We empirically investigate whether there is any statistically and economically meaningful correlation between the success a nation’s soccer team in the FIFA World Cup Finals and that nation’s real per-capita GDP growth. Using an unbalanced panel of countries from 1950 through 2004, we find that, for certain continents, there are non-trivial correlations between the World Cup finals, World Cup success, and real per-capita GDP growth. In Europe, North America, and South America, real per-capita GDP growth declines by approximately one percentage point in the years during which the World Cup Finals occur. Moreover, we find that in Africa, North America, and South America, the further a nation’s team advances in the month-long tournament the further the decline in real per-capita GDP growth. We estimate the contemporaneous impacts of the 2002 World Cup finals on per-capita income and a counterfactual real per-capita GDP series incorporating the varying levels of success in all of the World Cup finals held during our sample period