---
entity_slug: gold_and_silver_as_measure_of_value
evaluator: null
evaluated_at: '2026-02-23T05:33:09.302606'
overall_score: 4.4
scores:
- name: definition_precision
  value: 4.0
  max_value: 5.0
  rationale: The definition clearly distinguishes the "measure of value" function
    from the "medium of exchange" function of precious metals, and precisely identifies
    how this dual role creates a specific psychological misconception. The definition
    avoids circularity and captures a distinct conceptual mechanism rather than a
    vague category.
- name: source_grounding
  value: 5.0
  max_value: 5.0
  rationale: This entity is directly grounded in Smith's explicit analysis in Book
    IV, Chapter 1, where he systematically explains how the dual functions of money
    (measure of value and medium of exchange) lead people to confuse money with wealth
    itself. The connection to mercantile thinking is also clearly established in the
    source text.
- name: domain_placement
  value: 5.0
  max_value: 5.0
  rationale: The "Exchange" domain is perfectly appropriate since this entity deals
    with how money functions in transactions and how these exchange mechanisms create
    broader economic misconceptions. This is fundamentally about the mechanics and
    psychology of exchange systems.
- name: vsm_relevance
  value: 3.0
  max_value: 5.0
  rationale: This entity has moderate VSM relevance, potentially mapping to S4 (intelligence/environmental
    adaptation) as it concerns how economic actors perceive and interpret value signals
    in their environment. However, it's more of a cognitive/perceptual phenomenon
    than a clear structural system component.
- name: explanatory_value
  value: 5.0
  max_value: 5.0
  rationale: This entity provides excellent explanatory power by illuminating the
    specific psychological mechanism that underlies the entire mercantile system's
    flawed reasoning. It explains not just what mercantilists believe, but precisely
    why they come to hold these beliefs through everyday monetary experience.
---

# Evaluation: Gold And Silver As Measure Of Value

## definition_precision — 4.0 / 5.0

The definition clearly distinguishes the "measure of value" function from the "medium of exchange" function of precious metals, and precisely identifies how this dual role creates a specific psychological misconception. The definition avoids circularity and captures a distinct conceptual mechanism rather than a vague category.

## source_grounding — 5.0 / 5.0

This entity is directly grounded in Smith's explicit analysis in Book IV, Chapter 1, where he systematically explains how the dual functions of money (measure of value and medium of exchange) lead people to confuse money with wealth itself. The connection to mercantile thinking is also clearly established in the source text.

## domain_placement — 5.0 / 5.0

The "Exchange" domain is perfectly appropriate since this entity deals with how money functions in transactions and how these exchange mechanisms create broader economic misconceptions. This is fundamentally about the mechanics and psychology of exchange systems.

## vsm_relevance — 3.0 / 5.0

This entity has moderate VSM relevance, potentially mapping to S4 (intelligence/environmental adaptation) as it concerns how economic actors perceive and interpret value signals in their environment. However, it's more of a cognitive/perceptual phenomenon than a clear structural system component.

## explanatory_value — 5.0 / 5.0

This entity provides excellent explanatory power by illuminating the specific psychological mechanism that underlies the entire mercantile system's flawed reasoning. It explains not just what mercantilists believe, but precisely why they come to hold these beliefs through everyday monetary experience.
