24 May 2010

World Cup vs. Champions League: Mourinho's Hypotheiss

In the lead up to the Champion's League final, Jose Mourinho said:
"This game is the most important in the world. It is even bigger than the World Cup because the teams in it are at a higher level than national teams, who can't buy the best players."
We can forgive the Special One for a bit of hyperbole, but his comments raise an interesting hypothesis that can in fact be addressed empirically.

FutebolFinance.com provides a ranking of the transfer value of the top teams in the World Cup, as of late 2009, as follows:
The 10 most valuable teams in the world 2009
  1. Spain - 565 million Euros (FIFA Ranking 2nd place)
  2. Brazil - 515 million Euros (FIFA Ranking 1st place)
  3. France - 450 million Euro (10th in FIFA Ranking)
  4. England - 440 million Euros (FIFA Ranking 7th place)
  5. Italy - 400 million Euros (FIFA Ranking 4th place)
  6. Argentina - 390 million Euros (FIFA Ranking 8th place)
  7. Portugal - 340 million Euros (17th in FIFA Ranking)
  8. Germany - 305 million Euros (FIFA Ranking 4th place)
  9. Netherlands - 280 million Euros (FIFA Ranking 3rd place)
  10. Russia - 210 million Euros (FIFA Ranking 6th place)
Where would Inter Milan and Bayern Munich appear on this list? I have been unable to find a similar list for club teams. However, we can hazard a guess based on some relevant overall team value information. We can compare this to a more-or-less contemporary assessment of the player value of the Champions League entrants for the Premier League, courtesy of The Daily Mail:
1. Chelsea - 232 million Euros
2. Manchester United - 220 million Euros
3. Liverpool - 163 million Euros
4. Arsenal - 86 million Euros
An important qualification is that The Daily Mail valuations are what the teams cost to assemble not what the players are actually worth in the transfer market. The transfer market is illiquid and not all data on transfers is readily available (or if it is I have yet to find it). For instance, with reports today that Fabregas is worth some 40 million Euros, and Arsenal's reliance on players from within the club, the team valuation was probably low. So let's just double the valuation for the EPL Champions league participants to address this uncertainty. Even so, only Chelsea would crack the value of the top 3 national teams and Arsenal would not make the top 10.

The conclusion that I reach is that -- for at least the knock-out stages of 16 teams -- the Champions League is full of great players, but that the World Cup remains supreme, at least as measured by the economic value of players on teams.

Mourinho's hypothesis does not hold up.