Is there more to life than football? “Transformar o Jogo Bonito em Vida Bonita”

BLIToday’s post is from Anthony Gooch, Director of the OECD Public affairs and Communications Directorate and joint project leader of the OECD Better Life Initiaitive

In a phrase that has become immortal in football mythology, one of the greatest managers in the history of “O Jogo Bonito” (the beautiful game as Brazilians call it), a Scotsman named Bill Shankly of Liverpool FC, encapsulated its importance for football obsessives the world over: “Some people believe football is a matter of life and death… I can assure you it is much, much more important than that.

Few of us would go that far, but hundreds of millions of people will join in the four-yearly global communion about to begin in Brazil, the spiritual home of “O Jogo Bonito” through whatever means of communication at their disposal all the way through to its climax in mid-July. Football, and sport generally, is hugely important to people’s lives from all sorts of perspectives: whether it is those who derive enjoyment through playing or watching, those who are involved in the enormous economic activity that it generates, or society at large that is heavily influenced by it from the way some people dress to how they speak, the music they listen to and the role models they follow.

As the world prepares for its 4-yearly bout of Football Fever, it’s important to spare a thought for what happens when the final whistle blows, the game is over and the crowds go home. At the OECD, we’ve looked at “the day after”, the legacy of organising big sporting events. In 2010, before the London 2012 Olympics, we produced a review of the possible Olympic and Paralympic legacy for London, arguing that big events can make a positive, lasting contribution to their hosts if they build on strengths that are already there, you don’t have to start from scratch. In London’s case, we said that “it will be important to tell the story of east London’s inhabitants very much better. The area has a rich history as a centre for trade, logistics, and production, for hardworking people of exceptional character, for immigration and asylum… and for making lives worth living in ways they would not have been lived otherwise.”

That last part about making lives worth living in ways they would not have been lived otherwise is the core of the argument. Our Brazilian partner, the Fundacao Getulio Vargas have undertaken analysis on the impact of Football for the Socio-Economic Development of Brazil (FGV Projetos Cadernos 6/13 no22). Like the Olympics, staging the World Cup is expensive. Brazil will have spent BRL26 billion ($11 billion) on football stadiums and airport, port and urban mobility upgrades for the competition. But this accounts for only 0.7% of overall planned investment in Brazil in 2010-14 and most of the impact has already been felt, while for host cities and states, official estimates of World Cup-related spending range from just 0.24% to 12.75% of expected 2014 fiscal revenues.

Even so, 11 billion dollars is a huge sum of money, and millions of Brazilians who have emerged from poverty in recent years may think excessive to spend that much on football. With a growing lower middle class that pays taxes, demand for better education, health and transport is only going to increase. According to a recent survey by the Pew Research Center, over 60% of the population think hosting the event is a bad thing for the country because it takes money away from schools, health care and other public services. Only 34% think the World Cup will create more jobs and help the economy. A similar number (35%) thought hosting the competition would help Brazil’s international image, compared with 39% who said it will hurt and 23% thought it wouldn’t make any difference one way or the other.

The question of what makes life worth living, how best to balance competing interests, capacities and objectives is one that governments are trying to answer all the time. The OECD’s stated aim is to help develop “Better Policies for Better Lives”, but we know that, like football fans debating the greatest team of all time (Brazil 1970? Real Madrid 1960?) there’s no definitive answer. Therefore it is important to give citizens, voters and taxpayers the information and the voice to empower them to communicate to policymakers and shapers all over the world, their opinion about what counts for them.

To do so, we are launching O Indice para Uma Vida Melhor, the Portuguese version of the OECD’s Better Life Index on 9 June with football legend Pelé, Brazil’s Sports Minister Aldo Rebelo and our partners for O Indice the Fundacao Getulio Vargas. The Index is an online instrument that enables citizens the world over to create their Index of well-being and quality of life according to what is important to them. Users of the Index are asked to attribute relative importance to 11 topics that contribute to well-being to generate their Index. These include not only material aspects such as income, jobs and housing, but also quality of life aspects such as sense of community, education, environment, governance, health, safety, work-life balance and, last but not least, life satisfaction or a sense of happiness. Currently the Index captures data for 36 countries worldwide and this number is set to increase over time. An overall description of the quality of life in each of these countries is also provided, including how it performs across each of the 11 well-being dimensions. Freely-accessible OECD reports and other sources of information are provided to empower users.

Since the launch of the first English version, more than 4 million people in 184 countries have used the OECD Better Life Index, which has been referenced internationally as a model for presenting material on measuring well-being. Portuguese will be the sixth language version enabling over 250 million more people to access the Index in their mother tongue as is currently the case for English, Spanish, French, German and Russian speakers.

A completely new feature we are also unveiling now reveals for the first time what more than 65,000 people around the world believe to be the most important factors for quality of life based on the Indexes they have completed and shared with us in the last 3 years. This living database (www.OECDBetterLifeIndex.org/responses), viewable via an interactive map, allows people everywhere to see what matters to users of the Index. For citizens, the Index provides a way to be better informed about policies that that impact their well-being whilst for policymakers and shapers it begins to give a sense of what is most important to the people they work for which should help them improve their performance amd increase citizens’ satisfaction and engagement.

We have chosen the World Cup in Brazil as the ideal moment to launch an online global multilingual campaign “Is there #more2life than football?” to raise awareness not just in Brazil but across the globe on what really matters to people in their daily lives, what constitutes well-being and quality of life in the 21st Century.

For Matias Deodato de Castro e Melo, a character in one of the great Brazilian writer Machado de Assis’ Historias sem data (Stories without a date), “a felicidade é um par de botas” – happiness is a pair of boots. Whatever your team, we hope their boots will bring you some happiness over the coming weeks. Whatever happens to those teams and fans, whether they win or lose, after “O Jogo Bonito” it’s time to build “A Vida Bonita.

Useful links

The Beautiful Game and the Dismal Science

Today’s post is from Eva Marikova Leeds of the Department of Economics and Business, Moravian College and Michael A. Leeds of the Department of Economics, Temple University.

But is it level?

Every four years, economists around the world turn their attention to something of true interest to the world’s population – predicting who will win the World Cup.

Studies of what it takes to succeed in international football have confirmed that it pays to be big and it pays to be rich.

Countries with large populations and high GDP per capita have higher FIFA rankings and have more success in World Cup competition. 

By that standard, the United States should be an odds-on favorite for this year’s World Cup.  Of the 32 countries currently competing in South Africa, the United States is the most populous and has the highest GDP per capita (after adjusting for purchasing power). 

Obviously, population and income are not the sole determinants of success, as only the most wildly optimistic fans of Team USA expect it to get anywhere near the final round.  In a paper that was published in the August 2009 issue of the Journal of Sports Economics, we confirmed the finding that large, rich nations have greater success in international soccer competitions than small, poor nations. 

But we find that the importance of income and population – and hence the United States’ advantage – fall as they become larger.  More importantly, we also found that a variety of other economic, political, and institutional factors play an important role in a nation’s soccer prowess: 

  • It pays to be a well-to-do democracy.  Even when one controls for GDP per capita, countries that are members of OECD do better than other nations.  More than half of the teams in this year’s World Cup Finals belong to OECD. 
  • Currently communist countries have more success in soccer.  Thus soccer is one of the few venues in which North Korea’s regime has helped its country.
  • The old colonial order continues to hold when it comes to soccer, as the former colonial powers – England, France, Netherlands, Portugal, and Spain (all of which are in this year’s World Cup Finals) – do better than other nations.  
  • Oil-exporting countries do better in international soccer competition.  In this year’s final, that would give an advantage to Mexico and Nigeria.  
  • Perhaps the most important indicator of international success is a nation’s commitment to soccer.  We measured this commitment in two ways.  First, we found that nations that had hosted the World Cup (which 13 finalists have done) did better in international soccer.  Our second measure used the number of teams to reach the quarterfinals of Confederation competitions, such as the UEFA Champions League or the Copa Libertadores.  We found that a country’s national team did better as more of its club teams (which might or might not feature home-grown talent) reached the confederation’s quarterfinals.  This gives a big edge to England and an even bigger edge to Brazil.

What does all this mean for the upcoming World Cup Competition?  We applied our econometric results to data for 31 of the 32 nations competing in the finals (missing data led us to exclude North Korea) and found that the favorite is – surprise of surprises – Brazil. 

It just goes to show that economic analysis sometimes predicts the obvious.

Useful links

The OECD looks at Competition Issues Related to Sports (Yes, that really is the title).

And the World Cup winner is …

Allez les Bleus!

As the World Cup gets underway in South Africa, excitement is at fever pitch among soccer fans. For the rest of us, there will be nothing to do over the next month but wait to see how the financial sector reacts.

Even before the kickoff, some big names are already in action. Swiss giant UBS scored back in 2006 when it predicted that Italy would win the World Cup. Two years later, it used the same model to predict the winner of the European Championship: Sadly, it just wasn’t the Czech Republic’s year. This time round, UBS is offering only percentage likelihoods of victory. Its top four: Brazil, with a 22% chance of success, Germany on 18%, Italy on 13% and The Netherlands on 8%.

Goldman Sachs is also in cautious mood, and is predicting only the semi-finalists: England, Argentina, Brazil and Spain. But just for fun, it has also carried out a probability exercise based on FIFA rankings and bookmakers’ odds. Under that rubric, its top picks are Brazil, with a probability of success of just under 14%, Spain on just over 10%, and Germany and England neck-and-neck on just under 9½%.

And then there’s J.P. Morgan which has applied quantitative analysis to the problem. It sees  Brazil as the strongest team, but believes the fixture schedule will deprive it of the title. Instead, it predicts 3rd place for The Netherlands, 2nd for Spain and … a win for England (huh!).

But will markets respond to what happens on the pitch? Some believe they may, partly because testosterone-fuelled share traders are just the sort of guys who like to stay up all night watching big matches. In soccer-mad Hong Kong, China, for instance, trading is predicted to be light during the football festival, which can make for extra volatility in share prices.

In the United Kingdom, a study by a group of academics suggests shares in London fall when England loses or draws and rise when it wins. “Stockbrokers, like everyone else, can be carried away in the depression associated with an England loss at the World Cup,” Professor Robert Hudson told The Daily Telegraph.

 And then there are the business winners and losers. A good run for Portugal or Brazil might boost shares in Nike, which makes the teams’ kits. By contrast, success for Spain could be good news for Adidas. As HSBC’s Erwan Rambourg told Forbes, “The further your team goes in the tournament, the more jerseys, footwear and footballs you will sell.”

 The bigger question: Will the World Cup mark the beginning of a new era for Africa on the world stage? If you can tear yourself away from the soccer action, you’ll find regular postings here on the OECD Insights Blog over the next few weeks examining that question and, more broadly, the challenges facing Africa and its prospects for success in the post-World Cup era.  

 Useful links

 African Economic Outlook

 Africa at the OECD Development Centre

Photo courtesy of Steindy