English language competence is a skill acquired through many
hours of training and practice. For the individual who acquires
this skill the cost of his training and practice is equal to
the opportunity he foregoes when he trains and practices.
One measure of foregone opportunity is the individual's market
wage. For example, the value of one hour's worth of English language
practice to an individual who earns HK$ 60,00 per hour would
be HK$ 60.00. Someone who typically earns $4000.00 hour would
sacrifice far more money for the same hour's worth of practice.
For one hour's worth of training with a teacher each would suffer
not only the market worth of his own time but also the cost of
his lesson. Thus, if the teacher charged HK$ 500.00 per lesson,
the individual who earns HK$ 60,00 per hour would sacrifice HK$
560.00 for the lesson, and the individual who earns HK$4000.00
per hour would suffer an opportunity loss equal to HK$4500.00
dollars for the same time spent with the same teacher.
Young students, who are not permitted to enter the work force,
do not receive wages. As a result their foregone opportunity
must be measured in other ways. For example, how might a student
otherwise spend his time, if he were not studying English? Or,
under the assumption that the student might someday be paid for
his language competence, what is the discounted present value
of the incremental difference in wage that he might someday earn
for having studied one more hour than did his classmates while
he was still in school.
For employers the situation is similar. When the firm hires
an individual with English language competence, he expects the
individual's competence to add value to his firm. Although the
cost of language competence is likely to be the same for all
firms, the additional value that each firm receives for the same
expenditure will vary from firm to firm.
Firms that require English language competence on a daily
basis are likely to profit far more for the same wage expense
than those that require it only on occasion. Firms with little
need for English language competence are likely to secure a far
better return for the same level of expenditure by hiring more
costly translation agencies. The language competent employee
must be paid once a month for his competence. The outside translation
agency is paid only once for each task it performs.