# Chapter Analysis: Agricultural Systems of Political Economy and the Viable System Model

## Chapter Summary

This chapter presents a comprehensive critique of agricultural systems of political economy, which emerged as a response to Colbert's mercantile policies in France. Smith examines how these systems represent land produce as the sole or principal source of national wealth, classifying society into three distinct classes: proprietors, productive cultivators, and barren/unproductive merchants and manufacturers. The agricultural systems argue that only agricultural labour generates net surplus value (neat produce), while commercial and manufacturing activities merely replace existing value without creating wealth. Smith critiques this narrow view while acknowledging its intellectual sophistication, particularly through Quesnai's economical table that mathematically models ideal wealth distribution. The chapter ultimately advocates for the system of natural liberty as superior to both agricultural and mercantile systems, limiting sovereign duties to protection, justice, and public works. Smith demonstrates how agricultural systems, despite their theoretical appeal, would actually discourage the very agricultural industry they claim to promote through restrictive policies.

## Entities Extracted

- **Agricultural Systems of Political Economy**: A school of economic thought representing land produce as the sole or principal source of national wealth, contrasting with mercantile systems.
- **Productive Class**: Cultivators, farmers, and country labourers who generate surplus value (neat produce) that increases national wealth.
- **Barren or Unproductive Class**: Artificers, manufacturers, and merchants who merely replace existing value without creating net wealth.
- **Ground Expenses**: Landlord investments in land improvements that enable greater agricultural productivity.
- **Original and Annual Expenses**: Farmer expenditures on cultivation, including initial investments and ongoing operational costs.
- **Neat Produce**: The surplus value remaining after all necessary expenses are paid, representing true national wealth.
- **Productive Expenses**: Expenses that generate surplus value beyond replacement costs, including ground and farmer expenses.
- **Mercantile Stock**: Capital employed in trade that agricultural systems consider unproductive as it only circulates existing value.
- **Parsimony and Privation**: Economic principles requiring commercial nations to grow wealthy through saving rather than consumption.
- **Economical Table**: Quesnai's mathematical model of ideal wealth distribution under perfect liberty.
- **System of Natural Liberty**: Smith's preferred economic system emphasizing free trade and limited government intervention.
- **Three Duties of the Sovereign**: Protection from external threats, administration of justice, and provision of public works.

## VSM Mappings

- **Agricultural Systems of Political Economy → System 5 (S5) Policy**: Strong mapping - represents the supreme policy framework defining economic identity and values.
- **Productive Class → System 1 (S1) Operations**: Strong mapping - primary value-creating operational units generating neat produce.
- **Barren or Unproductive Class → System 1 (S1) Operations**: Moderate mapping - operational units performing essential functions but viewed as value-replacement rather than creation.
- **Ground Expenses → System 3 (S3) Control**: Strong mapping - internal infrastructure and resource allocation enabling optimal operations.
- **Original and Annual Expenses → System 3 (S3) Control**: Strong mapping - operational parameters and resource requirements governing productive activities.
- **Neat Produce → System 1 (S1) Operations**: Strong mapping - core output and value creation of operational level.
- **Productive Expenses → System 3 (S3) Control**: Strong mapping - internal management framework determining value-generating investments.
- **Mercantile Stock → System 1 (S1) Operations**: Moderate mapping - operational units performing value circulation despite being classified as unproductive.
- **Parsimony and Privation → System 4 (S4) Intelligence**: Strong mapping - strategic adaptation mechanisms for commercial nations in competitive environments.
- **Economical Table → System 5 (S5) Policy**: Strong mapping - mathematical model defining ideal economic organization and distribution.
- **System of Natural Liberty → System 5 (S5) Policy**: Strong mapping - comprehensive policy framework establishing fundamental economic principles.
- **Three Duties of the Sovereign → System 3 (S3) Control**: Strong mapping - essential internal regulation and resource allocation functions.
- **Three Duties of the Sovereign → System 5 (S5) Policy**: Strong mapping - supreme policy statement defining government's essential functions and identity.

## VSM Coverage

This chapter demonstrates strong coverage across the VSM framework, with all five primary systems (S1-S5) represented through multiple mappings. System 1 (Operations) receives the most extensive coverage with five distinct entities mapped to it, reflecting the chapter's focus on different types of economic activities and their value-creating potential. System 3 (Control) is well-represented with four mappings, showing how agricultural systems conceptualize internal management and resource allocation. System 5 (Policy) receives the most mappings (four), highlighting the chapter's emphasis on competing economic philosophies and policy frameworks. System 4 (Intelligence) has one mapping through parsimony and privation, representing strategic adaptation mechanisms. System 2 (Coordination) and System 3* (Audit) receive no direct mappings, indicating gaps in the analysis of coordination mechanisms and monitoring functions within the agricultural system framework.

## Gaps & Observations

The most significant gap is the absence of System 2 (Coordination) mappings, which would address how different economic activities coordinate and communicate within the agricultural system framework. This omission reflects the agricultural systems' focus on classification and value creation rather than coordination mechanisms. System 3* (Audit) is also missing, suggesting that agricultural systems may not adequately address monitoring and verification functions.

Several entities proved difficult to map definitively, particularly the classification of mercantile stock as System 1 operations despite being labeled "unproductive" by agricultural systems. This tension highlights the complexity of mapping economic classifications that contradict VSM principles about value creation.

Emerging patterns suggest that agricultural systems function primarily as policy frameworks (S5) that define economic identity and values, while operational activities (S1) are classified based on their perceived contribution to wealth creation. The strong emphasis on System 5 mappings indicates that agricultural systems are fundamentally about establishing economic philosophy rather than describing operational mechanisms.

Future analysis could enrich coverage by exploring how agricultural systems handle coordination between different economic activities (S2), what monitoring mechanisms they employ (S3*), and how they adapt to environmental changes (S4). Additionally, examining how these systems handle variety management and requisite variety would provide deeper insights into their cybernetic properties.