ATHLETIC prowess is not all that is being tested at this year's Olympic games. There will also be teams of econometricians battling it out to predict how many medals will be won by the host nation.
Over the years economists have deployed all sorts of mental gymnastics in their search for a model that can reliably forecast Olympic winners. Initial expectations that medal tallies would be closely correlated with the population and per - capita wealth of a country were soon dashed. The models leapt over the hurdle of statistical significance only when a third variable was added—how many medals the country won last time—but this did not add much by way of explanation.
Apart from the persistence of good(or bad) performance from one Olympiad to the next, the dismal scientists hopped, skipped and jumped to two other statistically significant results. First, there was a “Soviet effect”, whereby the planned economies of the former communist bloc tended to outperform, presumably due to forcing talented youngsters to specialise and pumping them full of steroids. This effect began to fall with the Berlin Wall.
Second, the host nation tends to win more medals than it does at any other time. Why it does so is unclear, as is the exact size of the “host effect”—which is why, for economists, predicting how many medals Britain will bag is the equivalent of winning the ۱۰۰ - metre dash. Emily Williams, the torchbearer for the Tuck School of Business team that won the medal - forecasting gold last time with ۹۵% accuracy, tips Britain’s athletes to win ۶۲ medals(۲۵ of them gold), up from ۴۷ four years earlier in Beijing. That would be a record haul for Britain, and place it fourth overall, behind America(۱۰۳), China(۹۴, down from ۱۰۰ when it hosted), and Russia(۶۷).
By contrast, PricewaterhouseCoopers thinks Britain will win 54 medals, and Daniel Johnson of Colorado College, another veteran forecaster, actually thinks Britain will win fewer medals at home than it did four years ago in Beijing (down by two to 45). The newcomer to the field is Kevin Daly, an economist at Goldman Sachs, who calculates that on average the host nation of an Olympics wins 54% more medals than usual. Taking Britain's 47 last time as "usual”, that would translate into a whopping 72 medals in London. We shall soon find out which, if any, of these dismal scientists is on the right track.
