by Agnes a Paris
Thu May 18th, 2006 at 08:30:42 AM EST
I understood from posts here and there that some of you had interest in football (shall I say soccer?-well this is supposed to be an European forum) so I thought I would share with you some anecdotes and thoughts that came to me last week.
Work brought me to Germany last week to visit a bunch of stadiums and talk with club managers, coaches and stadium owners.
For those unfamiliar with the topic, the World Cup is taking place in Germany this year, and there is quite a buzz around this event.
Football sure is a powerful cash drain, considering the amounts at stake when clubs transact the transfer of one star player. Further exploring the connections between football and economic growth is another matter, and may seem pretty far-fetched.
Can the power of luck, the thrill of hosting such an event influence the dreary economic indicators of a country? What takes place on a football pitch determines the mood of the nation- and sometimes even a country's economic welfare for the near future.
Even on a normal weekend in Germany, people's state of mind largely depends on the activities that are taking place on rectangular areas of grass and ash. Germany has 6.2 million people organized in 26, 000 football clubs, and these have 168, 000 teams. Four hundred thousand attend German league matches in the stadiums while eight million watch the game on TV. It's not about seeing "the better team" win but about seeing yours win.
When the Germans go back to work Monday morning, their mood is determined by the direction the ball took over the weekend.
Economically speaking, it will be Monday everyday for four weeks this summer. Moreover, people's expectations are not as modest as they used to be. The world Cup host at the first championships in Uruguay in 1930 had to reimburse European competitors for all their travel and hotel costs. Today, each host country counts on making a tidy profit from the event.
There is a football economy unconnected to results, outside the realm of ticket prices, transfer fees and perimeter advertising. A Postbank study claims that the additional sales of TV sets, beer, soft drinks, VIP hospitality, sporting goods and all the Wordl Cup merchandising by-products will bring in as much as 3 billion Euros. Noteworthy, 6 billion in private and public funds have been invested in stadium refurbishments, roads up-grading, hotels and train stations. In addition, a question rests over the 150 Euro per day foreign fan spending forecast made by the local industry.
Whether all this will end up with a financially balanced and possibly beneficial outcome remains to be seen.
No wonder estimates vary quite substantially as to the effectiveness of this summer's feel good pill. According to Postabank economists, it will boost the annual GDP by half a percentage point. Bochum-bsaed economist Markus Kurscheidt says that only cautious optimism allows contending, "the World Cup, in all probability, will not put us into debt". The last WC was co-hosted by Japan and South Corea. Though we don't know if all other things were equal, the latter's GDP jumped a handsome 7%. That pf Japan slumped a 0.3%. The south Koreans made it to the semi finals while the Japanese were eliminated in the round of sixteen.
The feel-good factor in France, who hosted and won the 1998 world Cup, was an important leveraging link between athletic and economic success. Private consumption jumped an incredible 1.5% in one of the most dramatic quarterly increases of all times. The birthrate in France also surged in the wake of the Bleus triumph, giving concrete meaning to French sociologist Edgar Morin observation that his country was experiencing "a collective orgasm" that summer 1998.
The competition itself remains a speculative science. Dortmund physics professor Metin Tolan claims to have discovered that team Teuton shows a winning streak every four or five world cups and that it's their trun again this year. Unfortunately (but reassuringly enough for his academic credibility) he only has limited faith in his own theory.
One thing is for sure. Wait and we are bound to an exciting competition, perhaps another Bern miracle... My personal favorite is the Ivory Coast team, the Elephants and as for the German team, I hope to see as much as possible of insanely cute Arne Fried.