---
entity_slug: original_and_annual_expenses
evaluator: null
evaluated_at: '2026-02-23T06:03:46.240672'
overall_score: 4.4
scores:
- name: definition_precision
  value: 4.0
  max_value: 5.0
  rationale: The definition clearly distinguishes between original expenses (initial
    setup costs like instruments, cattle, seed) and annual expenses (ongoing operational
    costs like maintenance and wear). The categorization is precise and non-circular,
    though it could be slightly more explicit about the temporal distinction between
    one-time versus recurring costs.
- name: source_grounding
  value: 5.0
  max_value: 5.0
  rationale: This entity is directly grounded in Smith's detailed analysis of agricultural
    expenses in Book IV, Chapter 9, where he explicitly categorizes farmer expenses
    into these two components. The definition accurately reflects Smith's own terminology
    and conceptual framework without introducing external concepts.
- name: domain_placement
  value: 5.0
  max_value: 5.0
  rationale: The "Production" domain assignment is entirely appropriate, as these
    expenses are fundamental operational costs directly related to agricultural production
    processes. This concept sits squarely within production economics rather than
    distribution, exchange, or consumption.
- name: vsm_relevance
  value: 4.0
  max_value: 5.0
  rationale: This entity maps well to S1 (primary operations) as it describes the
    essential resource requirements for agricultural production operations. It also
    has some relevance to S3 (internal regulation) in terms of cost management and
    resource allocation, making it a strong fit for VSM analysis.
- name: explanatory_value
  value: 4.0
  max_value: 5.0
  rationale: This entity provides genuine explanatory power by illuminating the structural
    relationship between different types of production costs and their role in determining
    agricultural profitability and rent. It reveals an important economic mechanism
    about how surplus is calculated after accounting for necessary expenses.
---

# Evaluation: Original And Annual Expenses

## definition_precision — 4.0 / 5.0

The definition clearly distinguishes between original expenses (initial setup costs like instruments, cattle, seed) and annual expenses (ongoing operational costs like maintenance and wear). The categorization is precise and non-circular, though it could be slightly more explicit about the temporal distinction between one-time versus recurring costs.

## source_grounding — 5.0 / 5.0

This entity is directly grounded in Smith's detailed analysis of agricultural expenses in Book IV, Chapter 9, where he explicitly categorizes farmer expenses into these two components. The definition accurately reflects Smith's own terminology and conceptual framework without introducing external concepts.

## domain_placement — 5.0 / 5.0

The "Production" domain assignment is entirely appropriate, as these expenses are fundamental operational costs directly related to agricultural production processes. This concept sits squarely within production economics rather than distribution, exchange, or consumption.

## vsm_relevance — 4.0 / 5.0

This entity maps well to S1 (primary operations) as it describes the essential resource requirements for agricultural production operations. It also has some relevance to S3 (internal regulation) in terms of cost management and resource allocation, making it a strong fit for VSM analysis.

## explanatory_value — 4.0 / 5.0

This entity provides genuine explanatory power by illuminating the structural relationship between different types of production costs and their role in determining agricultural profitability and rent. It reveals an important economic mechanism about how surplus is calculated after accounting for necessary expenses.
