---
entity_slug: monopoly_effects_on_market_price
evaluator: null
evaluated_at: '2026-02-23T05:55:13.168279'
overall_score: 4.6
scores:
- name: definition_precision
  value: 4.0
  max_value: 5.0
  rationale: "The definition clearly identifies a specific mechanism - monopolists\
    \ deliberately understocking markets to maintain prices above natural levels.\
    \ It's precise about the causal chain (understocking \u2192 reduced supply \u2192\
    \ higher prices) though could be slightly more specific about what constitutes\
    \ \"natural price.\""
- name: source_grounding
  value: 5.0
  max_value: 5.0
  rationale: This entity is directly grounded in Smith's text from Book I, Chapter
    7, with a specific quote provided about monopolists keeping markets "constantly
    understocked" and selling "much above the natural price." The concept aligns perfectly
    with Smith's analysis of market distortions.
- name: domain_placement
  value: 5.0
  max_value: 5.0
  rationale: '"Regulation" is the correct domain placement as this describes how monopolistic
    market structures regulate (distort) pricing mechanisms. This is fundamentally
    about market regulation and control rather than production, exchange, or distribution
    per se.'
- name: vsm_relevance
  value: 4.0
  max_value: 5.0
  rationale: This maps well to S3 (internal regulation) as it describes how monopolists
    regulate market supply to maintain control over pricing. It also has S4 elements
    (intelligence about market conditions) as monopolists must monitor demand to maintain
    optimal understocking.
- name: explanatory_value
  value: 5.0
  max_value: 5.0
  rationale: This entity provides excellent explanatory power by revealing the specific
    mechanism through which monopolies distort markets - not just charging high prices,
    but strategically controlling supply to maintain pricing power. It illuminates
    a key structural relationship between market control and price formation.
---

# Evaluation: Monopoly Effects On Market Price

## definition_precision — 4.0 / 5.0

The definition clearly identifies a specific mechanism - monopolists deliberately understocking markets to maintain prices above natural levels. It's precise about the causal chain (understocking → reduced supply → higher prices) though could be slightly more specific about what constitutes "natural price."

## source_grounding — 5.0 / 5.0

This entity is directly grounded in Smith's text from Book I, Chapter 7, with a specific quote provided about monopolists keeping markets "constantly understocked" and selling "much above the natural price." The concept aligns perfectly with Smith's analysis of market distortions.

## domain_placement — 5.0 / 5.0

"Regulation" is the correct domain placement as this describes how monopolistic market structures regulate (distort) pricing mechanisms. This is fundamentally about market regulation and control rather than production, exchange, or distribution per se.

## vsm_relevance — 4.0 / 5.0

This maps well to S3 (internal regulation) as it describes how monopolists regulate market supply to maintain control over pricing. It also has S4 elements (intelligence about market conditions) as monopolists must monitor demand to maintain optimal understocking.

## explanatory_value — 5.0 / 5.0

This entity provides excellent explanatory power by revealing the specific mechanism through which monopolies distort markets - not just charging high prices, but strategically controlling supply to maintain pricing power. It illuminates a key structural relationship between market control and price formation.
