Johannesburg -
Prepare to be disappointed, South Africans. One of the world's
leading sports economists says you're not going to get rich hosting
next year's World Cup.
There'll be no economic bonanza, according to a new book, and if
experience matches the last World Cup in Germany, spending by
visitors will be much less than the South African government
shelled out preparing for the tournament.
"The next World Cup will not be an airplane dropping dollars on
South Africa," authors Stefan Szymanski and Simon Kuper write in
the book "Soccernomics."
The caveat comes just ahead of Friday's World Cup draw in South
Africa, six months before football's showpiece tournament.
Using data analysis, history and psychology, the book debunks
dozens of myths about what it takes to win, and who makes money in
football - and in sports in general.
"The problem for South Africa is that they have to spend quite a
lot to build stadiums," Szymanski said in a telephone interview
from London. "Germany could afford this, and it had stadiums
anyway. But South Africa is a nation that can ill afford to fritter
away a few billion on white elephants."
Following the 2002 World Cup, for instance, South Korea's
K-League had difficulties filling the 10 new stadiums built for the
tournament at a cost of more than $2bn.
The book's argument is that hosting a World Cup or Olympics is
an inefficient way to revitalise a city, or enrich a nation -
especially one like South Africa, where a third of the population
lives on under $2 a day. It can boost a nation's morale or image,
but not much else.
"If you want to regenerate a poor neighborhood, regenerate it,"
Szymanski and Kuper write. "If you want an Olympic pool and a
warm-up track, build them. You could build pools and tracks all
across London, and it would still be cheaper than hosting the
Olympics."
Taking the magic out of soccer?
Szymanski, an economics professor at Cass Business School in
London, and Kuper, a sports writer living in Paris, challenge
plenty of accepted wisdoms. They even talk of opening a consulting
firm for leagues and clubs, promising to improve performance and
save money.
"We are not trying to take the magic out of soccer," Szymanski
said in the interview. "But we want to understand the patterns,
because they are not completely random."
Some of the sometimes surprising declarations are:
- The huge transfer fees spent in European club soccer bear
little relation to where the club finishes in the league.
-
By contrast, spending on player salaries explained very
accurately where a club finishes.
- Researchers predicted how Chelsea players would take their
penalties in the shootout at the 2008 Champions League final.
- Teams shouldn't buy players based on performance at big
tournaments like the World Cup.
- Contrary to popular belief, the word "soccer" originated in
England, not the United States.
- Norway is the country that loves football the most.
- Tournaments such as the World Cup stop thousands from killing
themselves - no one can stop watching.
- Taking into account national income and population, Honduras is
the most overachieving country in football and Canada is the most
underachieving.
The book suggests the United States, Japan, and Australia are
the rising powers in world football, while national teams in China,
Iraq, Turkey and India could emerge as incomes rise and they pick
up European expertise. They claim African nations struggle because
they are mostly small and poor and can't afford top European
coaching.
The United States, in particular, because of its population and
wealth, could be the first of the nations on the rise to win a
World Cup.
"The one missing link for the United States is the transfusion
of European knowledge into the game, which has largely been
resisted," Kuper said, speaking from Paris. "The idea remains that
an American coach can do it alone. But the best coaching is in
western Europe."
Szymanski and Kuper say many of the world's biggest football
clubs are not only poorly run from a purely financial viewpoint,
but are small businesses dwarfed by the real titans of industry. In
2008 the average club in the English Premier league had revenue of
$150m, compared with $100m for a single British Tesco
supermarket.
That is because clubs can not possibly capture the amount of
interest they generate: newspaper stories, reports on Internet
sites, computer games, fodder for radio and TV talkshows, and
discussions over dinner, at work or with a few beers.
"All this entertainment is made possible by soccer clubs, but
they cannot appropriate a penny of the value we attach to it," the
authors say. "Chelsea cannot charge us for talking or reading or
thinking about Chelsea."
They cite a 2009 annual survey by the accounting firm Deloitte
showing that Real Madrid led the "Money League" with revenues of
about $475m. Manchester United was No. 2 at $422m.
However that is based on turnover, not profits, which tell a
very different story.
Watford, Reading and Arsenal - the last coached by Arsene
Wenger, a trained economist - were the three most profitable in the
Premier League, though Watford and Reading have since been
relegated.
Chelsea and Manchester United, who have shared the past five
Premier League titles? Among the least profitable.
- Sapa