Dr. Thomas Dohmen

Thomas Dohmen, senior research associate at Bonn University, said a representative survey of 3,200 people during and after the World Cup found the soccer tournament had a lasting psychological impact on consumers in Europe's largest economy. "The 'World Cup effect' was far more pronounced than we had anticipated," Dohmen said. "It made everyone feel richer than they were.They stopped saving for rainy days and spent more because they felt the economy was suddenly in better shape." The researchers calculated that all 39 million German households now "feel" they have an extra 500 euros income each month because of Germany's good run at the World Cup -- totalling nearly 20 billion euros per month. The perceived effect on income was calculated using mathematical formulae to measure how the tournament changed people's views on the German economy and their own situation. "It's a staggering amount," Dohmen told Reuters in an interview.He said the effect would have disappeared if Germany had been knocked out early in the tournament. Instead, Germany made it to the semi-final and finished third out of the 32 teams despite being ranked only 19th. "All of a sudden, people across Germany started viewing their own personal economic situation better than they did before the tournament began," Dohmen said."They felt wealthier and were ready to consume more." Big investment decisions were also made during the euphoria surrounding the soccer tournament, he said.Company investment has been a key driver of German growth this year. The German government will raise its economic growth forecast for 2006 this week to 2.3 per cent from a 1.6 per cent estimate made before the June tournament that brought millions of Germans into the streets for public viewing parties. If confirmed, that would be the economy's best performance since 3.2 per cent in 2000, ending a long period of stagnation. Dohmen rejected the idea that consumers are just bringing forward purchases to avoid a 3 percentage point rise in value-added tax in 2007. He also said the World Cup itself had only a minimal impact on the economy: a few thousand jobs, most temporary, were created and more than two million tourists came to Germany. "This feeling of wealth that people have is not rational and has nothing to do with soccer," Dohmen said.

Thomas Dohmen, senior research associate at Bonn University, said a representative survey of 3,200 people during and after the World Cup found the soccer tournament had a lasting psychological impact on consumers in Europe's largest economy.

"The 'World Cup effect' was far more pronounced than we had anticipated," Dohmen said.
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"It's a staggering amount," Dohmen told Reuters in an interview.He said the effect would have disappeared if Germany had been knocked out early in the tournament.

Instead, Germany made it to the semi-final and finished third out of the 32 teams despite being ranked only 19th.

"All of a sudden, people across Germany started viewing their own personal economic situation better than they did before the tournament began," Dohmen said."They felt wealthier and were ready to consume more."

Big investment decisions were also made during the euphoria surrounding the soccer tournament, he said.Company investment has been a key driver of German growth this year.

The German government will raise its economic growth forecast for 2006 this week to 2.3 percent from a 1.6 percent estimate made before the June tournament that brought millions of Germans into the streets for public viewing parties.

If confirmed, that would be the economy's best performance since 3.2 percent in 2000, ending a long period of stagnation.

Dohmen rejected the idea that consumers are just bringing forward purchases to avoid a 3 percentage point rise in value-added tax in 2007.

He also said the World Cup itself had only a minimal impact on the economy: a few thousand jobs, most temporary, were created and more than two million tourists came to Germany.

"This feeling of wealth that people have is not rational and has nothing to do with soccer," Dohmen said.

The analysis, by Thomas Dohmen of the Bonn-based Institute for the Study of Labor, looked at 3,519 matches over 12 Bundesliga seasons.

"In line with the preferences of the crowd, referees lengthen exciting games and favour the home team by allowing most additional time when the home team is behind by one goal, especially when the crowd largely consists of home team supporters," Dohmen said.
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Dohmen conducted the study to examine the issue of how social pressure affects preferences or actions.

RUNNING TRACK

The study suggested the strength of referee bias depended on the crowd's proximity to the field and could be influenced by the presence of a running track separating fans from the pitch, as in Berlin's and Munich's Olympic stadiums.

"A remarkable finding is also that more penalties are awarded in stadiums without a running track," Dohmen said.

"Strikingly, given that a penalty was awarded, the decision was more likely to be correct when the game took place in a stadium in which a track separates the stands from the field."

A total of 65 percent of home team penalties were justified compared with 72 percent for visiting sides, the study showed.

Dohmen said he was not alleging that German referees were intentionally biased.

"Instead, a likely explanation for the observed behaviour is that referees are emotionally influenced by the atmosphere in the stadium," he added.

And Dr Thomas Dohmen said that in only 65 per cent of cases were refs justified in awarding the home team a penalty.

He said there was clear evidence the referee tends to make more disputed or wrong rulings the closer the spectators are to him - so he feels the pressure when a stadium has no running track, for example.

He added that refs seem to think 'when in doubt, decide in favour of the home team' but heis not sure if this is a conscious or subconscious decision.

As part of his work for Bonn University, he used a data bank recognised by the German Football League that collects more than 2000 facts per game.

He found that the closer the rival teams lived to each other, the less preferential treatment given to the home team.He explained: 'The closer the opponent, the more fans there are who go to an away match.