Wednesday, June 28, 2006

Footballnomics: exception #2

Q: What is 'Incemental Capital-Output Ratio' (ICOR) and what does the number explain?

A: Simply, ICOR is the ratio of investment to output. If the number is high then the economy requires a big amount of investment to produce a certain output level . Hence, high ICOR constitutes inefficiency.

An example of high ICOR is: Ghana. They produced a lot of shots on goals, but did produce any goals against Brazil. Other example: Holland in Eur0 2000 when they were defeated by Italy in the semifinal, or Manchester United's Andy Cole a few years back.

2 comments:

  1. He..he.. another exception from self impose ban of footballnomics/ econofootball.

    One professor tell me that a rule/theory with too many exception is hardly a rule/theory

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  2. Berly - as our customer you have the right... to remain silent! :-)

    ReplyDelete