Editorial: The Economics of Soccer Success


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You do not have to be the sharpest of our many sharp readers to have noticed that we are not a sports publication. The masthead does not name us as the Budapest Sports Journal, and we have never seriously considered a swimwear issue. Despite that, it is to sporting prowess that my attention has been drawn this week. Specifically, the 4:0 thumping Hungary handed out to England in England in the Nations’ League on Tuesday night, the home team’s worst home result since 1928.

Both countries have a fondness for slightly odd sports, think of cricket for England and handball or water polo for Hungary, but for each, football is the people’s game, the sport of mass appeal. That is despite a comparative lack of success. England has only ever got through to one world cup final, which they won, and one European final, which they lost, and that’s about it.

On the other hand, Hungary has three Olympic titles and was runner-up in the 1938 and 1954 World Cups. England claims to have invented the game (which, as with many sports, is disputed and probably impossible to prove), but Hungary revolutionized it in 1953 and produced one of the all-time great squads in the Golden Team.

Led by Ferenc Puskás, for whom the national stadium is named, Hungary and England have history. Once a Hungarian discovers you are English, it won’t be long before the conversation comes round to a particular score line – 6:3. The date is well known to Hungarians: November 25, 1953. England was well beaten at Wembley for the first time in 90 years. Worse was to come a year later, on May 23, 1954, in Budapest, with England humiliated 7-1.

All this history was raked over again when England played Hungary in Budapest on June 5 and lost 1:0. Most people I spoke with had expected Hungary to lose. Even after that game, one colleague remarked, with typical Hungarian pessimism, that it was more that England played poorly rather than Hungary played well. Presumably, England was awful on June 14. The home crowd certainly thought so.

Under Viktor Orbán’s multiple premierships, a vast amount of money has been invested in sports in general and football in particular. Is this a return on that investment? At present, Hungary tops a strong group that includes Germany (one point behind), Italy (a further point adrift), and then England, winless and bottom.

Time will tell if this is a resurgence or a brief rally, but does it have any economic benefit for the country? A paper published in 2014 asked if soccer data could be used to measure economic and social development. According to the website sportseconomics.org, “The authors suggest there is a positive effect from international football success on productivity through increases in happiness and positive intangible effects, such as community spirit, self-confidence, pride, solidarity, etc.” Could a feel-good factor around the water cooler equate to greater productivity?

While it seems an undoubted link is not established, “The empirical analysis in the paper [...] clearly finds a strong association between FIFA ranking and GDP per capita and HDI [Human Development Index]. The relationship is particularly notable for developing countries. The authors accept that determining causality is not straightforward, but that a ‘significant association does exist’ and that football performance may be mirroring national institutions that strongly affect development.”

I read that as “case unproven.” Perhaps it’s better just to enjoy a good sporting run for its own sake. For Hungary, for now, that means making the most of the Nations League. The world cup is played in Qatar in November and December this year. Hungary has not qualified; England did. Good luck with that.

Robin Marshall


This editorial was first published in the Budapest Business Journal print issue of June 17, 2022.

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