In This Review

Beautiful Game Theory: How Soccer Can Help Economics
Beautiful Game Theory: How Soccer Can Help Economics
By Ignacio Palacios-Huerta
Princeton University Press, 2014, 224 pp

Soccer -- or football, in most of the world -- is universally popular, especially in years when the World Cup takes place. The sport is also notable for another reason: it has produced a gold mine of data. Detailed records of professional-league games go back many years and cover many countries. Palacios-Huerta draws on that copious archive of information to illuminate and formally test a number of propositions in economics, including the “minimax” strategy devised by game theorists and the efficient-market hypothesis proposed by finance theorists; both concepts pass empirical muster, according to Palacios-Huerta’s analysis. The book also examines the impact on soccer matches of economic incentives, social pressure, racial discrimination, and the fear of hooliganism, which sometimes emerges among the crowds at soccer games. Parts of the book are written mainly for economists, and numbers abound. But lay readers can skim or even skip those parts; the rest of the book is enjoyably accessible to nonspecialists, especially sports enthusiasts, who will learn a great deal about soccer, economics, and human behavior more generally.