Master Craftsman Supervision Opportunity Cost
RCTReview
Although subsidized dual apprentices increase total physical work output in host firms, providing mandatory daily instruction requires master craftsmen to divert time away from direct revenue-generating production, creating an offsetting opportunity cost that leaves enterprise profits unchanged.
Picture this
A master carpenter gains extra help from an apprentice to sand wood, but must spend two hours every day standing over the apprentice to explain measurements instead of building furniture himself. The extra money made from the apprentice's manual work is offset by the lost sales from the master's lost production time, leaving total shop profit the same.
What the evidence says
Apprentices spent 2.628 hours daily under direct master supervision out of 8.170 total working hours; pooled enterprise sales (-52,922 FCFA, p = 0.25) and enterprise profits (-15,820 FCFA, p = 0.14) showed no statistically significant program impact.
- Who was studied
- N = 674 informal micro and small enterprises evaluated across 4 distinct sales/profit measures in Côte d'Ivoire.
- How
- Enterprise-level pooled OLS regression measuring monthly revenues, profits, and daily hours spent by apprentices under direct master supervision.
What to do
Incorporate master trainer time reallocation and lost billable production hours into net enterprise profit evaluations of workplace training programs.
From the source
"The provision of training also has an opportunity cost for firms, including the opportunity cost of time of mastercraftmen. Finding zero effects on profits is consistent with these effects cancelling each others."
Direct_and_Indirect_Effects_of_Subsidized_Dual_Apprenticeships.pdf