The Ugly Side of a Sport?

Last weekend in the German Grand Prix of Formula One (F1), Fernando Alonso won with Ferrari teammate Felipe Massa in second place.  That would have been entirely without comment other than to applaud the ability of those two drivers to finish at the top of the pack, had Massa not been given veiled orders to let Alonso past him two laps from the end of the race.

Ferrari have been fined $100,000 for this, but the result stands – meaning Alonso remains a strong candidate for the overall F1 Championship, which is a very competitive 5-way tussle this year.

Nonetheless, purists complain; it wasn’t the best driver that won the race, and Alonso has been given an “unfair” helping hand in his Championship pursuit.  Ferrari have responded predictably defiantly: It has always been this way – not that it’s right or wrong or ethical.  Is it the driver, or is it the team?  Purists would respond it is the driver and bemoan such malign intervention by teams.

Some have responded that more regulation needs to be introduced to stop this – the BBC article on Ferrari’s response lists nine previous incidences of team orders affecting outcomes since 1997 alone.  But of course that won’t work.  Teams will only find more veiled methods to get team orders out to drivers to ensure that the “right” result happens.  Massa was only informed that his teammate Alonso was the “faster” driver, not told to let him past explicitly.

Bigger fines could be introduced – $100,000 in a multi-billion dollar industry is peanuts and won’t stop any of the teams with a shout of the Championship to think twice about such corruption.  But would bigger fines just make the methods of transmitting teams orders even more cryptic and hard to spot?

A New Method of Forecasting?

Time series econometric methods, and other economic methods, have long been maligned for their inability to generate accurate forecasts.

Perhaps all along we’ve been looking in the wrong place for accurate forecasts: http://news.bbc.co.uk/1/hi/world/europe/10521867.stm

The Resurgence of Europe and the Germans in Particular

There was a strange response in England to Germany’s latest four-goal victory: We somehow felt better about the thumping we received from the Germans!  The usual theory about a World Cup is that the stage at which you are knocked out is the stage at which you face Brazil.  That’s not quite right any more as shown by the Dutch this time round and the French (hard to believe but true) in 2006.  It seems it’s when you face Germany that you go out now – and the youth of their team suggests that this may be the case in 2014 too (although the tournament is in Brazil then), and 2018 also possibly (though with the possibility that 2018 happens in England, my patriotic sense hopes England have a young team to compete by then!).

Moreover, again there’s the tacit recognition of the remarkable ability of German teams to do well in tournaments – how do they do it?  This time round it’s clear – they have a fantastic team.  But they’ve made the semis in six of the last eight World Cups – that takes us back 32 years to 1978.  The period 1978-1990 is a given – Germany had great teams then.  But since 1990 – perhaps since 1996 when they won the European Championships, no German side has been in any way spectacular – and from an English perspective, no better than any English side since then.  Yet Germany has still made the final in 2002 and the semis in 2006 – as well as a European Championships Final in 2008 to boot.  What is that organisational ability, that human capital at the management level, that means that a very average German team (e.g. 2002) can make it to the final?  My theory is that it’s the stage at which they faced Brazil (England met them in the quarters) – but that doesn’t explain the other successes since the mid-1990s.  Answers on a postcard.

But in 2010, have the Germans peaked a little too soon?  A tournament is seven matches, the last four in knock out stages.  It’s a fairly long haul, and it pays to conserve energy and momentum for the very latter stages.  Italy are a great example of this, only really coming good against Germany in 2006, and then in the last few minutes of extra time – before beating France in the final.  Germany on the other hand have well and truly revealed themselves on the world stage now.  No sneaking past the Argentinians – they trashed them devastatingly.  But their higher profile now means more pressure – expectations from themselves and others to repeat that level of performance.  Will that pressure yield a more nervy performance against Spain?  In 2008, the Netherlands started explosively, beating the French and Italians by three goals a piece.  But they slunk out in the last 16 to Russia, having seen their momentum run its course.

The Beautiful (and painful) Game!

England wakes up this morning with yesterday’s drubbing at the hands of Germany still fresh in the memory (if I’m a good representative of our nation – and I think I’m a fairly mild mannered one judging by the expletives coming out of the neighbour’s house yesterday post match).

There’s no escaping the fact the best team won: England’s defence looked shaky in the group stages (at least they sorted the goalkeeping issue out) and was embarrassingly (if you’re English and a defender when playing the game yourself, like I am) exposed by a good (but not that good) German side.

But if my Facebook wall is anything to go by, the discussion does still remain focussed on that goal (pictured).  And that’s not amongst English folk.  Italians, Americans that I know – even some Germans!

An Australian friend put it aptly: England were bad, but what might have happened had the goal rightly been noticed?  I will gloss over the really unbelievable fact that no official saw the ball bounce about half a meter over the line.  Had the goal gone in, an already rattled Germany side may have reacted quite differently.  England would have had the momentum and all Germany’s fine efforts to establish a two goal advantage would have been wiped out within a minute.

As it was, England were still faced with a deficit, and the need to push forward to get an equalising goal.  As the second half pressed on, that issue became more and more pressing, and England committed more men forward.  The defence was bad enough as it was, and soon enough Germany broke (from a very promising England free-kick situation) and scored.  Not long after, from an England attacking corner, the same devastating counter-attack play by Germany put the game out of England’s reach and gave the game a slightly surreal scoreline (ok, I am English so I’m allowed some bias).

More than anything though, once the pain subsides, it left yet another England-Germany game that will live in the memory for a long time.  It yet again established why football is so popular – the game was nailbiting, was so open, and decided by such fine lines and moments like the goal not seen.  What if one of England’s second half attempts on goal had sailed in, levelling the scores?  So many what-ifs.  It could also have been more painful a scoreline for England.

But this post cannot finish without noting the oft-touted, and now pretty much demanded, involvement of technology.  The more blinkered and paranoid England fans will suggest a conspiracy.  I think it was just human error and I’ll stick with that naive view for now.  So given it was human error, and these kinds of events happen with a remarkable regularity in games, the only real solution is to use technology.  Hawkeye has established itself as a very useful tool in cricket and tennis – but even that would not be necessary.  Simply a chip in the ball would be enough – that would be able to tell if the ball went over the line and would enable officials to make decisions that are too close to call in the heat of the moment from their viewing angle.

There’s plenty to be argued for such involvement of technology, and also to some extent against it – and currently the most important man, Sepp Blatter, is against it.  Had yesterday’s goal been correctly given with little fuss by technology though, would some of that fan interest be lost?  Isn’t some of the experience of football that element of human error, that element of “we wuz robbed”?  Would demand for football actually fall as a result of making the game less accessible, as some are arguing?  At what point would the technology be used?  National league top divisions?  Pub teams on a Sunday?  The debate rages…

More World Cup Economics and Econometrics (or Quants)

Nick’s beaten me to posting about the World Cup predictions of large financial institutions, but I’ll follow on from there.  We’re now just over 24 hours until the World Cup starts with Mexico taking on the hosts, South Africa.

As mentioned, a number of large financial corporations have placed their hat in the ring to forecast who will win the World Cup, and of course also who will be the big winners economically.  Chances are it won’t be South Africa, but that’s another blog post or two.

Anyhow, from the FT we find that Danske Bank picked Brazil based on a quants model (to the best of my ignorance, quants model basically means some form of econometric model to the rest of us?), UBS followed suit with the South Americans although JP Morgan bucked the trend and picked England to win.  If you’re interested, you can take part in a competition to try and beat the predictions of the banks here.

I have decided to make some predictions, and to use econometrics and data to do so.  I’ve estimated an ordered probit model based on around 3000 historical football matches (a whole range of competitions including importantly the qualifiers from all regions of the world).  Perhaps unsurprisingly I find that Brazil wins – beating Spain in what would be a tasty final.  England make the semi-finals, as do Germany (England losing to Brazil, Germany to Spain in a re-run of the Euro 2008 final).

Of course, this is all conjecture and probability.  We shall see who comes out on top and which model is best.

On to South Africa vs Mexico though.  Nick fancies Mexico, and I do too based on my model: It gives them a 56% probability of winning, South African only a 24% probability of winning.  But Betfair isn’t so sure: As of 11am British Summer Time, Mexico are at 36%, with South Africa at 34% (probabilities implied from the decimal odds there).  I’ve done a fair bit of research on Betfair (which will hopefully be published soon), and their implied probabilities are usually very accurate indeed.

Are they able to better take into account factors such as the first World Cup on African soil, those horns the fans will be blowing, and all the other emotions associated with a World Cup that mean events like Cameroon beating Argentina in 1990 and Senegal beating France in 2002 can happen?  We shall soon see…