ENGLAND stuttered and stumbled on their way to another lacklustre, uninspiring World Cup victory on Sunday when they defeated the minnows of Ecuador. The nation continues to hope beyond the duty of patriotism and the evidence on the pitch that the team’s performance will improve before the first real test on Saturday against its nemesis, Luis Felipe Scolari, and the technically-gifted Portuguese.

Beckham and England may not be helping the nerves of the country with their displays on the pitch, but their continuing participation is providing a welcome boost to the economy.

The British Retail Consortium has estimated that the World Cup will increase spending in the UK economy by £1.5bn, which could be even higher if England progress further in the tournament.

In Guernsey, the tournament should also have a similar, proportionate impact on spending.

And if England defy the critics and actually go on to lift the trophy on 9 July, experts have even speculated that it could improve GDP growth by an incredible 0.7%, based upon the experience of previous winners. But spare a thought for the losing finalists, who have on average seen a fall in GDP growth of 0.3%.

Keynes talked of ‘animal spirits’ when he tried to evaluate the unpredictable impact of changes in mood on national economic performance.

The World Cup is a classic illustration of this phenomenon as psychology and the intangible feelgood factor play their parts in fostering optimism and confidence, which then translate into higher levels of spending.

Consumers feel happier and have greater self-esteem as England beat other countries and advance in the tournament, so they spend more money.

Businesses experience an upturn in demand, so they invest more in capital equipment and stocks, thereby contributing to aggregate demand and ultimately economic output and growth.

All this should make up for any loss in productivity if workers are absent to watch the games.

Although the World Cup has a positive overall impact on output and growth, there are winners and losers among the various industries that make up the broad economy.

Pubs and bars are clear beneficiaries as many people gather there to watch the games.

Supporters spend tens of millions of pounds on alcohol during England matches and the brewer, Scottish & Newcastle, is expecting a significant lift to its profitability as a result of the competition.

Of course, many fans will stay at home to see England play, which then stimulates the sales of supermarkets and electrical retailers as consumers buy food, alcohol and plasma televisions.

John Lewis was selling one plasma TV every forty seconds before the start of the competition.

The advertising and media industries also enjoy an increase in spending by companies that want to be associated with the glory and image of the cup and to reach the billions of captivated consumers who are easy prey for their marketing messages.

And willing punters ensure that the gambling industry profits from the millions of pounds-worth of bets they place on each match, unless a favourite like Brazil wins.

However, many travel agents have reported a drop in the number of holiday bookings they have taken as people stay at home while the competition is on.

This has led to numerous unsold holidays that have forced them to lower their prices and damage their profitability.

A significant minority of homebuyers, particularly first-time purchasers, have delayed their search until the end of the tournament, which has temporarily affected some estate agents and mortgage brokers.

High street retailers have described quiet trading conditions during England matches and must be preparing for lower footfall on Saturday afternoon. Many of these lost sales will never be recovered.

Some cinemas in the UK have even closed their theatres during the afternoon because demand has been so sluggish.

The cup will provide a boost to the UK and local economies, although some industries will benefit more than others.

Its positive impact will be greater the longer England stay in the tournament, so let us hope that the team can improve its performance to enable us all to reap the potential financial and psychological rewards.

If not, there is always Tim Henman to cheer at Wimbledon…