There are three main interested parties in a commercial endeavor: the shareholders, the employees, and the customers.
The employees and customers have no property rights, and the latter are a shrinking minority of the population with little political power to fight any nationalization (as evidenced by their failure to beat the many onerous regulations successfully put in place already). The former employees have somewhat better a chance to organize, but the best estimate I can find of the total number of employees is ~2100, who likewise have failed to stop the creation of the existing regulations; tobacco is no longer grown commercially in Australia, so you can ignore the farmers as they are overseas and are ill-placed to affect Australian politics and also suffer from steep coordination costs.
Measured profit, discounted and extended far in to the future (the AU$5B mentioned) covers only the shareholders.
Who are the ones who can most easily lobby against it and have the property rights which would be seized in a nationalization, and hence the NPV of their stake is the most important figure.
The economic value to employees is likely much larger,
What, all 2100 of them? ‘much larger’? You think each one values that exact job at >$23.8m (5000000000/2100 ~> 23,80,952.381)? The Australian economy has been consistently good for a long time now, so they can find other jobs in manufacturing and marketing, meaning the marginal value of the job existing is not going to be that high to them even if they were guaranteed lifetime employment.
and the imputed value to smokers, as measured by the amount they’re willing to pay, greater still.
No one believes that their willingness to pay reflects their true utility, and that’s why tobacco is getting regulated out of existence.
The employees and customers have no property rights, and the latter are a shrinking minority of the population with little political power to fight any nationalization (as evidenced by their failure to beat the many onerous regulations successfully put in place already). The former employees have somewhat better a chance to organize, but the best estimate I can find of the total number of employees is ~2100, who likewise have failed to stop the creation of the existing regulations; tobacco is no longer grown commercially in Australia, so you can ignore the farmers as they are overseas and are ill-placed to affect Australian politics and also suffer from steep coordination costs.
Who are the ones who can most easily lobby against it and have the property rights which would be seized in a nationalization, and hence the NPV of their stake is the most important figure.
What, all 2100 of them? ‘much larger’? You think each one values that exact job at >$23.8m (
5000000000/2100 ~> 23,80,952.381)? The Australian economy has been consistently good for a long time now, so they can find other jobs in manufacturing and marketing, meaning the marginal value of the job existing is not going to be that high to them even if they were guaranteed lifetime employment.No one believes that their willingness to pay reflects their true utility, and that’s why tobacco is getting regulated out of existence.