Photographer: Dado Galdieri/Bloomberg

Goldman's Economists Are Forecasting Olympic Medals

Brazil will win more Olympic medals than ever before as it plays host to the world's athletes.

Can the quality of a country's institutions help predict success at beach volleyball?

Goldman Sachs Group Inc. thinks it can. 

Four years ago economists at the bank attempted to see if "macroeconomic variables and statistical relationships" could predict medal tallies at the 2012 London Olympics. They ended up perfectly predicting the total medals — 65 — nabbed by the U.K. hosts and picked 10 of the top 11 countries in the gold medal tables. This year, Goldman economists are aiming to repeat that success ahead of this summer's games, which begin in Rio de Janeiro later this week. 

The economists' forecasts take into account a country's growth conditions, including measures of the political and institutional environment, as well as the size of its population and its previous Olympic performance. 

Here are Goldman's medal predictions for 2016:

GS - Medal tally

The  team made a special adjustments for Russia — typically among the top five medal winners — since it is unclear to what degree the country will participate. Apart from Russia, there are few surprises at the top of the table, except perhaps for Brazil. The 22 medals Goldman predicts would amount to the host nation's best ever performance in an Olympic games. 

That could be the silver (and gold) lining Brazil needs after its troubled journey to host the world's athletes — a spike in crime, plumbing emergencies and the Zika virus being among just some of its challenges. (That's not mentioning a political scandal that's ensnared members of the business and political elite, and the economy sinking into its biggest slump in a century.)

Still, for all its predicted successes on the track and volleyball court, the Goldman analysts also forecast that the Olympics will do little to stimulate Brazil's growth. The roughly $10 billion spent on infrastructure and logistics is too insignificant to move the needle in a $1.8 trillion economy, especially when total investment spending has been contracting uninterruptedly since 2014, the economists wrote.

"As the country welcomes thousands of athletes and visitors and cheers the local favorites, it silently hopes that the soaring Olympic spirit will also help lift the animal spirits of the Brazilian economy and bring it back to the podium reserved for the top performers. Overall, we believe the World Cup and Olympics related investment was just too small to generate a significant economic dividend/impulse given the sheer size of the economy."

To make matters worse, four years from now Brazil's medal hoard will be a lot smaller. Playing host helps boost a country's tally of gold medals by about 50 percent, and its total pile by 20 percent, according to the economists. That means the U.K. will lose roughly 10 percent of their overall medal tally and 15 percent of their golds in Rio.


With Japan hosting the 2020 Olympics, Brazil will face an even tougher fight to keep hold of its medals. That's because Japan is the world's fourth most 'sporty' country, according to the Goldman economists' index of how much countries are punching above their demographic weight:

GS - outperform