NCPA - National Center for Policy Analysis

Gold For GDP?

June 12, 2001

The Olympics are a test of athletic prowess between competing citizens of various nations. Many try to predict how many medals a nation will win by a number of variables. A new study argues that it is possible to predict how many medals a nation will get by simply measuring two variables: per capita gross domestic product (GDP) and population. Multiplying the two variables together yields a country's GDP, or output.

A larger population increases the size of the talent pool a country can draw upon for top athletes. However, population size is not enough -- otherwise China, India and Indonesia would have had a greater number of medals. GDP is also necessary. It reflects the wealth of the country and the amount of resources the nation can devote to training talented individuals.

After looking at the past 30 years' worth of Olympics, researchers found that a country's share of global GDP closely tracked its Olympic performance:

  • At the Atlanta Games, China, India, Indonesia and Bangladesh, which had 43 percent of the world's population, won only 6 percent of the Games' medals.
  • On the other hand, their combined portion of the global GDP is 5 percent, much closer to 6 percent.
  • For 36 countries participating in the Sydney Games, each of which won at least five medals, GDP predicts as much as 96 percent of the winners.

However, two exceptions to this strong correlation were found:

  • Countries hosting the Games win almost 2 percent more medals than predicted by GDP, because of forced mobilization of resources by governments and the effect of home-crowd enthusiasm.
  • And countries of the former East European Bloc have historically won an average of 3 percent more medals than predicted by their share of GDP -- showing the even greater ability of Communist regimes to commandeer their societies' resources.

Source: "GDP and Olympic Success," Economic Intuition, Winter 2001; based on Andrew B. Bernard and Meghan R. Busse, "Who Wins the Olympic Games: Economic Development and Medal Totals," NBER Working Paper No. W7998, November 2000, National Bureau of Economic Research.

For NBER text

http://papers.nber.org/papers/W7998

 

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