Britain should just stop participating in Eurovision
The Eurovision Song Contest (ESC) has a special place in my heart and in the heart of so many Europeans. Not because of the quality of the songs and artists that participate in it, but because of the sheer craziness and campness of it all. Every year, I look forward to it while my American wife refuses to endure four hours of really bad music. But apparently, next year, the US will start its own song contest between states. To my American friends, I say: You have no idea what’s coming for you.
The UK, just like Germany has for years been abysmal in the contest, typically scoring close to zero points and ending in one of the last places. Which is why both countries should just stop participating in the contest altogether. That would at least boost their stock markets.
A group of Israeli researchers looked at the stock market returns of countries that win the song contest and found that on the day after the country wins the contest, the local stock markets gets an average abnormal return boost of 0.57%. That is not too surprising. We know that after a country wins the FIFA World Cup or the Euros, the local stock market gets a boost the next trading day because people in that country are not just hungover but also euphoric and more optimistic and increased optimism leads to higher risk-taking and a rally in stock markets.
What is interesting, though is that they also looked at the abnormal stock return of countries that score less than 10 points in the song contest. And while the abnormal returns in these countries wasn’t statistically significant it was nevertheless an average abnormal return of -0.07%. In other words, the UK and Germany would have to win the contest every eight years or so to make up for the dreadful impact acts like Jemini (UK entry 2003) or Electro Velvet (UK entry 2015), Ann Sophie (German entry 2015), or Levina (German entry 2017). And that seems really hard to do.
So, let’s just pull out of the contest and enjoy the show that other countries put on. It would be much better for our national pride and our stock markets.
Average time between victories at the ESC