All may not be lost for Australia as they head to Porto Alegre for a daunting second round World Cup clash with the Netherlands.

An economic model developed at Griffith Business School suggests Australia is more likely to make the World Cup semi-finals than established football powers like Argentina, Uruguay or even Chile who defeated the spirited Socceroos in their tournament opener.

The bad news for Australia is that they remain well behind the top tier teams most likely to reach the last four, based on economic data post GFC and past performances at the World Cup.

ABC Radio: Professor Carmignani explains his theory on 612 ABC Drive

Germany, Netherlands, France, Italy and Brazil emerged as the top five nations most likely to reach the semi-finals, with Australia rated 16th of 32 competing nations.

Spain (8), England (11) and the United States (12) ranked above Australia, with Uruguay (18), Chile (22) and Argentina (24) in the bottom half. African countries made up the bottom four teams.

“The lower a country’s rate of growth, the more likely this country is to make it through to the semis,” explains Professor of Economics, Fabrizio Carmignani, who developed the model.

“After accounting for the rate of growth, richer countries with more advanced economies are more likely to reach the semi-finals.”

Acknowledging that some countries are simply better at football than others, Professor Carmignani factored this into the economic model by including the number of times that a country reached the semi-finals in the previous five editions of the World Cup into the calculations.

The model estimates confirm that the probability of a country to be successful (to reach the semi-finals in any given World Cup) increases with:

  1. the higher the level of per capita GDP in this country;
  2. the lower its rate of GDP growth; and
  3. the more semi-finals it has played in previous World Cups.

“Estimates based on the period between 1986 and 2010 can then be used to predict the probability that a country will reach the semi-finals in 2014, given its current level of per capita GDP and its rate of growth in the past five years,” Professor Carmignani said.

“A group of five countries (Germany, the Netherlands, France, Italy, and Brazil) has a very high probability to make it to the semi-finals. Not surprisingly, four of these are European countries. The recession does pay off — but maybe only in football.”

The second-tier group includes four countries — Croatia, Portugal, Spain and Greece — which, again, are all victims of the economic crisis. England is in the third tier, along with United States, Belgium and Switzerland. Australia leads the fourth-tier group, with a 14% probability to make it to the semi-finals.

“With an average rate of economic growth of 5% per year for the past five years, Argentina is simply doing too well economically to hope to do well in the World Cup.”