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Forecasting the FIFA 2018 World Cup

As the FIFA 2018 World Cup is approaching and fans are getting excited, Achim Zeileis (among others) computes winning probabilities based on a bookmaker consensus model. Read more to see which teams have the highest winning probabilities.

For this year's World Cup in Russia, there will be two top favorites for winning the trophy - Brazil with a forecasted winning probability of 16.6%, closely followed by the defending World Champion and 2017 FIFA Confederations Cup winner Germany with a winning probability of 15.8%. Spain and France are also not far behind. Regarding the Cup's host Russia, although they are certainly not among the favorites for the title, their probability of reaching the quarter final is still 28.9%. In their working paper, Achim Zeileis and two colleagues from the Wirtschaftsuniversität in Vienna apply the so-called bookmaker consensus model based on quoted odds from 26 bookmakers and betting exchanges to obtain their forecasts. The paper also includes pairwise probabilities for each possible game along with probabilities for each team to proceed to the various stages of the tournament. This comparison shows that the most likely final will be between Germany and Brazil (5.5% probability), where Germany and Brazil are close to being tied regarding their corresponding winning probabilities (50.6% for a victory of Brazil).

Basis of the model

The model is based on bookmaker quotes. Achim Zeileis argues that since the bookmakers' intention is to earn money, they set the quotes as realistic as possible and consider next to historical data also more revent events such as injuries. All this gives a solid basis for the method applied by Zeileis, Leitner and Hornik.

All in all, the paper is not supposed to give certainty over the winner of this year's World Cup, but it certainly does provide interesting insights and might give you an edge at betting games with your friends. 

Links und Working Paper

  • for some interactive graphics, have a look at Achim Zeileis' homepage
  • for the full working paper published in our eeecon working paper series, see this link

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