Football. A sport that unleashes a phenomenon, uniting nations and bringing together people from a myriad of backgrounds to cheer as one in support of their team. With the World Cup almost upon us, we’ve taken the modelling skills we use in our day job to predict the outcome.
By using some of the economic tools we usually apply in assessing investment opportunities, we’ve calculated that there is 60 percent likelihood that one of Germany, Brazil, or Spain will win the tournament. Among them, Germany has the highest odds of winning, with a 24 percent chance of lifting the famous trophy. Germany, the current holders, and Brazil, appear set for an easy start, but Spain will have to hit the ground running in its first game if it is to beat Portugal, the current European champions.
In addition, England, France, Belgium and Argentina are all capable of causing an upset. Our simulations show that all four stand a decent chance of lifting the trophy. Argentina’s fate in particular will depend on the form of its star players, which adds an element of uncertainty and is hard to capture in our quantitative model.