---
entity_slug: bank_economic_efficiency_metrics
evaluator: null
evaluated_at: '2026-02-23T00:39:10.441212'
overall_score: 3.6
scores:
- name: definition_precision
  value: 4.0
  max_value: 5.0
  rationale: The definition is quite precise, clearly specifying concrete metrics
    (cost-income ratios, return on assets, capital adequacy ratios) rather than vague
    concepts. It distinctly captures the idea of quantitative measures for banking
    assessment, though it could be slightly more specific about what constitutes "efficiency"
    versus other performance aspects.
- name: source_grounding
  value: 2.0
  max_value: 5.0
  rationale: This entity appears to introduce modern banking terminology and metrics
    that would not have existed in Smith's 18th-century context. While Smith discusses
    banking operations and their effects, he would not have used contemporary financial
    ratio analysis or formal efficiency metrics as described here.
- name: domain_placement
  value: 4.0
  max_value: 5.0
  rationale: The "Accumulation" domain placement is appropriate since banking efficiency
    directly relates to capital formation and the productive use of accumulated wealth.
    Banking metrics fundamentally concern how well financial institutions facilitate
    the accumulation and deployment of capital in the economy.
- name: vsm_relevance
  value: 5.0
  max_value: 5.0
  rationale: This entity maps excellently to VSM System 3 (internal regulation/audit),
    as these metrics are precisely the kind of performance monitoring and control
    measures that S3 uses to ensure operational units meet standards. The metrics
    also support S4 intelligence functions by providing data for strategic decision-making.
- name: explanatory_value
  value: 3.0
  max_value: 5.0
  rationale: While the entity identifies important measurement tools, it primarily
    names metrics rather than explaining underlying mechanisms of how banking efficiency
    affects economic outcomes. It has moderate explanatory value for understanding
    banking performance but doesn't illuminate deeper structural relationships in
    Smith's economic framework.
---

# Evaluation: Bank Economic Efficiency Metrics

## definition_precision — 4.0 / 5.0

The definition is quite precise, clearly specifying concrete metrics (cost-income ratios, return on assets, capital adequacy ratios) rather than vague concepts. It distinctly captures the idea of quantitative measures for banking assessment, though it could be slightly more specific about what constitutes "efficiency" versus other performance aspects.

## source_grounding — 2.0 / 5.0

This entity appears to introduce modern banking terminology and metrics that would not have existed in Smith's 18th-century context. While Smith discusses banking operations and their effects, he would not have used contemporary financial ratio analysis or formal efficiency metrics as described here.

## domain_placement — 4.0 / 5.0

The "Accumulation" domain placement is appropriate since banking efficiency directly relates to capital formation and the productive use of accumulated wealth. Banking metrics fundamentally concern how well financial institutions facilitate the accumulation and deployment of capital in the economy.

## vsm_relevance — 5.0 / 5.0

This entity maps excellently to VSM System 3 (internal regulation/audit), as these metrics are precisely the kind of performance monitoring and control measures that S3 uses to ensure operational units meet standards. The metrics also support S4 intelligence functions by providing data for strategic decision-making.

## explanatory_value — 3.0 / 5.0

While the entity identifies important measurement tools, it primarily names metrics rather than explaining underlying mechanisms of how banking efficiency affects economic outcomes. It has moderate explanatory value for understanding banking performance but doesn't illuminate deeper structural relationships in Smith's economic framework.
