# Map Economic Entities to VSM Concepts

You are a systems theorist specializing in Stafford Beer's Viable System Model.
Your task is to map extracted economic entities to VSM concepts.

## Extracted Entities

--- ENTITY: stock ---

# Stock

## Definition

The accumulated wealth of an individual or society that can be employed to generate revenue, distinguished from immediate consumption goods and divided into capital (which yields profit) and revenue (which supports consumption).

## Source Chapter

Book II, Chapter 1

## Context

The foundational concept introduced at the beginning of Book II, establishing the distinction between stock that produces revenue and stock consumed for immediate subsistence, forming the basis for Smith's analysis of capital accumulation and economic growth.

## Economic Domain

General Theory

---
--- ENTITY: capital ---

# Capital

## Definition

That portion of an individual's stock which is expected to yield revenue, employed either in purchasing goods for resale with profit (circulating capital) or in improving land and acquiring productive machinery (fixed capital).

## Source Chapter

Book II, Chapter 1

## Context

Developed as one of the two fundamental divisions of stock, capital is defined by its revenue-producing function and further distinguished into circulating and fixed forms based on how it generates profit.

## Economic Domain

Accumulation

---
--- ENTITY: circulating capital ---

# Circulating Capital

## Definition

Capital employed in purchasing goods for resale with profit, which yields no revenue while in possession and only generates profit through successive exchanges and circulation from one form to another.

## Source Chapter

Book II, Chapter 1

## Context

One of two forms of capital, exemplified by merchant stock that must be continually sold and repurchased to generate profit, distinguished from fixed capital by its requirement for circulation.

## Economic Domain

Exchange

---
--- ENTITY: fixed capital ---

# Fixed Capital

## Definition

Capital employed in improving land, purchasing productive machinery, or acquiring instruments of trade that yield revenue or profit without changing masters or requiring circulation.

## Source Chapter

Book II, Chapter 1

## Context

Distinguished from circulating capital as the form that generates profit through productive improvements and durable assets rather than through exchange and circulation.

## Economic Domain

Production

---
--- ENTITY: revenue ---

# Revenue

## Definition

The income derived from stock employed as capital, whether through the sale of circulating goods or through the productive use of fixed capital in land improvement and machinery.

## Source Chapter

Book II, Chapter 1

## Context

The profit generated by capital, contrasted with the portion of stock reserved for immediate consumption, and forming the basis for understanding how wealth accumulates and sustains economic activity.

## Economic Domain

Distribution

---
--- ENTITY: immediate consumption ---

# Immediate Consumption

## Definition

That portion of an individual's stock reserved for present use and subsistence, consisting of food, clothing, household furniture, and dwelling houses that provide no revenue but sustain the owner.

## Source Chapter

Book II, Chapter 1

## Context

The second fundamental division of stock, distinguished from capital by its consumption function rather than revenue production, forming the basis for understanding the distinction between wealth accumulation and subsistence.

## Economic Domain

Consumption

---
--- ENTITY: labouring poor ---

# Labouring Poor

## Definition

The majority of workers whose stock is insufficient to maintain them beyond a few days or weeks, deriving revenue solely from their labour without capital accumulation.

## Source Chapter

Book II, Chapter 1

## Context

Introduced as the baseline economic condition against which capital accumulation is contrasted, representing the subsistence economy from which economic development begins.

## Economic Domain

Production

---
--- ENTITY: master artificer ---

# Master Artificer

## Definition

A skilled craftsman who employs capital in his trade, requiring fixed capital in the form of tools and instruments while circulating the remainder in wages and materials.

## Source Chapter

Book II, Chapter 1

## Context

Exemplifies the intermediate economic position between merchants (purely circulating capital) and farmers (significant fixed capital), illustrating the varying proportions of fixed and circulating capital across occupations.

## Economic Domain

Production

---
--- ENTITY: farmer's capital ---

# Farmer's Capital

## Definition

The stock employed in agriculture, divided into fixed capital (instruments of husbandry and breeding cattle) and circulating capital (wages of servants and maintenance of labouring cattle).

## Source Chapter

Book II, Chapter 1

## Context

Provides a detailed example of how agricultural capital combines fixed and circulating elements, with profit derived both from keeping breeding stock and from selling fattened cattle.

## Economic Domain

Production

---
--- ENTITY: society's general stock ---

# Society's General Stock

## Definition

The aggregate wealth of all inhabitants or members of a country, naturally dividing into the same three portions as individual stock: immediate consumption, fixed capital, and circulating capital.

## Source Chapter

Book II, Chapter 1

## Context

Extends the analysis from individual economic agents to the national economy, establishing the framework for understanding how different forms of capital contribute to national wealth and economic development.

## Economic Domain

General Theory

---
--- ENTITY: productive abilities ---

# Productive Abilities

# Definition

The acquired and useful talents of society's members, acquired through education and apprenticeship, constituting a form of fixed capital that contributes to national wealth through increased productivity.

## Source Chapter

Book II, Chapter 1

## Context

Identified as the fourth component of fixed capital, alongside machines, buildings, and land improvements, highlighting human capital as a productive resource.

## Economic Domain

Production

---
--- ENTITY: circulating capital components ---

# Circulating Capital Components

## Definition

The four parts of circulating capital: money for circulation, provisions in possession of producers, raw materials and partially manufactured goods, and finished work held by merchants and manufacturers.

## Source Chapter

Book II, Chapter 1

## Context

Provides the detailed breakdown of circulating capital's composition, showing how different forms of goods and money facilitate economic exchange and production.

## Economic Domain

Exchange

---
--- ENTITY: land, mines, and fisheries ---

# Land, Mines, and Fisheries

## Definition

The primary sources of raw materials and provisions that replenish circulating capital and maintain the economic system, providing the natural resources from which all economic activity ultimately derives.

## Source Chapter

Book II, Chapter 1

## Context

Identified as the fundamental sources of economic renewal, explaining how natural resources support the continuous circulation and replacement of capital throughout the economy.

## Economic Domain

Production

---
--- ENTITY: feudal government effects ---

# Feudal Government Effects

## Definition

The political system that encouraged the concealment and burial of stock due to fear of violence from superiors, representing an economic barrier to capital accumulation and market development.

## Source Chapter

Book II, Chapter 1

## Context

Provides historical context for understanding how political institutions can inhibit economic development by creating insecurity that prevents capital from being employed productively.

## Economic Domain

Regulation

---
--- ENTITY: treasure-trove ---

# Treasure-Trove

## Definition

Concealed wealth discovered in the earth to which no particular person could prove right, considered part of sovereign revenue in feudal times and reflecting the economic insecurity of the period.

## Source Chapter

Book II, Chapter 1

## Context

Illustrates the economic consequences of feudal insecurity, where valuable resources remained buried rather than being employed productively in the economy.

## Economic Domain

Regulation

---
--- ENTITY: dwelling house distinction ---

# Dwelling House Distinction

## Definition

The economic difference between houses used as capital (rented for revenue) and those used for immediate consumption (owner-occupied, providing no revenue to the public).

## Source Chapter

Book II, Chapter 1

## Context

Clarifies how the same physical asset can function differently in the economy depending on its use, distinguishing between capital that generates revenue and consumption goods that do not.

## Economic Domain

General Theory

---
--- ENTITY: masquerade dress trade ---

# Masquerade Dress Trade

## Definition

The commercial practice of renting masquerade costumes for temporary use, representing how consumption goods can occasionally function as capital when rented for revenue.

## Source Chapter

Book II, Chapter 1

## Context

Provides an example of how goods normally reserved for immediate consumption can occasionally generate revenue when employed as capital through rental arrangements.

## Economic Domain

Exchange

---
--- ENTITY: improved farm advantages ---

# Improved Farm Advantages

## Definition

Agricultural land that has been profitably enhanced through clearing, draining, enclosing, and manuring, functioning as fixed capital that facilitates and abridges labour like any other productive machine.

## Source Chapter

Book II, Chapter 1

## Context

Demonstrates how land improvements constitute fixed capital, comparing their productive advantages to mechanical inventions and emphasizing their durability and profitability.

## Economic Domain

Production

---
--- ENTITY: seed as fixed capital ---

# Seed as Fixed Capital

## Definition

The total value of seed employed in agriculture, considered fixed capital because it moves between ground and granary without changing masters, generating profit through increase rather than sale.

## Source Chapter

Book II, Chapter 1

## Context

Provides a nuanced example of fixed capital, showing how agricultural inputs can function as capital despite their apparent circulation between different locations.

## Economic Domain

Production

---
--- ENTITY: three-way employment of stock ---

# Three-Way Employment of Stock

## Definition

The three possible uses of capital: for immediate consumption, as fixed capital, or as circulating capital, representing all possible ways stock can be employed to generate present enjoyment or future profit.

## Source Chapter

Book II, Chapter 1

## Context

Concludes the chapter by summarizing the fundamental choices available for employing stock, establishing the framework for understanding all economic activity in terms of these three categories.

## Economic Domain

General Theory

---

## VSM Framework Reference

---
id: vsm-framework
name: vsm_framework
artifact_type: content
description: Stafford Beer's Viable System Model reference for economic analysis
version: 1.0.0
---

# Stafford Beer's Viable System Model (VSM)

The Viable System Model (VSM) is a model of the organisational structure of any
autonomous system capable of producing itself. It was created by management
cybernetician Stafford Beer in his books *Brain of the Firm* (1972) and
*The Heart of Enterprise* (1979).

## Core Principle: Viability

A viable system is any system organised in such a way as to meet the demands
of surviving in a changing environment. One of the prime features of systems
that survive is that they are adaptable. The VSM expresses a model for a
viable system, which is an abstracted cybernetic description applicable to
any organisation that is a going concern.

## The Five Systems

### System 1 (S1) — Operations

The primary activities that produce the organisation's purpose. These are the
operational units that directly create value. Each operational element is itself
a viable system (the principle of recursion).

**In economic terms:** Productive enterprises, factories, farms, workshops,
individual labourers performing specialised tasks, merchant operations.

**Key properties:** Autonomy within constraints, self-organisation,
direct engagement with the environment.

### System 2 (S2) — Coordination

The information channels and bodies that allow the primary activities in
System 1 to communicate with each other and that allow System 3 to monitor
and coordinate activities. System 2 dampens oscillations and resolves
conflicts between operational units.

**In economic terms:** Market price mechanisms, trade customs, standard
weights and measures, commercial law, banking clearinghouses, trade guilds.

**Key properties:** Anti-oscillatory, dampening, scheduling, conflict
resolution, standardisation.

### System 3 (S3) — Control / Operational Management

The structures and controls that establish the rules, resources, rights,
and responsibilities of System 1 and provide an interface between Systems 1
and Systems 4/5. System 3 represents the day-to-day control of the
organisation. It optimises the internal environment.

**In economic terms:** Government regulation of trade, taxation policy, labour
laws, enforcement of contracts, the "invisible hand" as emergent internal
regulation, guilds and corporations governing members.

**Key properties:** Internal regulation, resource allocation, accountability,
synergy extraction, performance management.

### System 3* (S3*) — Audit / Monitoring

The audit and monitoring channel that allows System 3 to verify information
coming from System 1 through channels other than those provided by System 2.
System 3* provides sporadic, direct access to operational reality.

**In economic terms:** Market inspections, quality checks, auditing of accounts,
surprise investigations into trade practices, verification of weights and measures.

**Key properties:** Sporadic direct investigation, reality checking, bypassing
normal reporting channels.

### System 4 (S4) — Intelligence / Adaptation

The bodies and processes that look outward to the environment to monitor
how the organisation needs to adapt to remain viable. System 4 captures
all relevant information about the outside-and-then environment. It is
responsible for strategic responses.

**In economic terms:** Foreign intelligence about trade opportunities,
market research, new technology adoption, colonial exploration and trade
route development, understanding of foreign economic systems.

**Key properties:** Environmental scanning, future orientation, strategic
planning, modelling, research and development.

### System 5 (S5) — Policy / Identity

The policy-making body that balances demands from Systems 3 and 4 and defines
the identity, values, and purpose of the organisation. System 5 provides
closure to the whole system and represents its supreme authority.

**In economic terms:** Sovereign authority, constitutional principles governing
economic policy, national economic identity, the philosophical foundations
of economic systems (mercantilism vs. free trade), the overarching purpose
of the commonwealth.

**Key properties:** Identity, ethos, supreme command, policy closure,
balancing internal and external perspectives.

## Key Concepts

### Recursion

Every viable system contains and is contained in a viable system. The same
five-system structure recurs at every level of organisation. A workshop is
a viable system within a factory, which is a viable system within an
industry, which is a viable system within a national economy.

### Variety

A measure of the number of possible states of a system. The Law of Requisite
Variety (Ashby's Law) states that only variety can absorb variety. A
controller must have at least as much variety as the system it controls.

### Requisite Variety

The principle that for effective regulation, the variety of the regulator
must match the variety of the system being regulated. This is achieved
through variety attenuation (reducing the variety coming up from operations)
and variety amplification (increasing the variety of management's responses).

### Attenuation and Amplification

Variety engineering mechanisms. Attenuation reduces variety (e.g., reporting
summaries, statistical aggregation, standardisation). Amplification increases
variety (e.g., delegation, empowerment, decentralisation).

### Algedonic Signals

Emergency signals that bypass the normal management hierarchy to alert
higher systems of critical situations requiring immediate attention. Named
from the Greek words for pain (algos) and pleasure (hedone).

**In economic terms:** Market panics, famine signals, sudden price collapses,
trade embargoes, economic crises that demand immediate sovereign intervention.

### Autonomy

The degree of freedom granted to operational units (System 1) to self-organise
within constraints set by System 3. Beer argued that maximum autonomy
consistent with systemic cohesion yields maximum viability.

### Viability

The capacity of a system to maintain a separate existence and survive in a
changing environment. A viable system continuously adapts while maintaining
its identity.


## Mapping Guidelines

---
id: mapping-rules
name: mapping_rules
artifact_type: content
description: Guidelines for mapping economic entities to VSM concepts
version: 1.0.0
---

# VSM Mapping Rules

## Mapping Principles

1. **Ground in Beer's definitions.** Every mapping rationale must reference
   the specific VSM system function, not just a superficial resemblance.

2. **Prefer structural over metaphorical mappings.** A mapping is strong
   when the economic entity performs the same *functional role* in Smith's
   economic system as the VSM component performs in an organisation.

3. **Allow multiple mappings.** A single economic entity may map to
   multiple VSM systems. For example, "the sovereign" may map to both
   S3 (regulation) and S5 (policy). Create separate mapping documents
   for each relationship.

4. **Respect recursion.** Consider at which level of recursion the mapping
   applies. The division of labour within a single workshop (S1-level)
   differs from the division of labour across an entire national economy
   (higher recursion level).

## Mapping Strength Criteria

### Strong
- The entity directly performs the function of the VSM system.
- The mapping would be recognisable to a VSM practitioner without explanation.
- Example: "market price mechanism" → S2 (Coordination) — prices coordinate
  supply and demand between producers.

### Moderate
- The entity partially performs the function or performs it in a limited context.
- The mapping requires some argument but is defensible.
- Example: "merchant" → S4 (Intelligence) — merchants gather information
  about foreign markets, but this is not their primary function.

### Weak
- The mapping is speculative or metaphorical rather than structural.
- The connection exists but requires significant interpretive work.
- Example: "moral sentiments" → S5 (Policy) — broad ethical framework
  shapes economic behaviour, but the connection is indirect.

## What NOT to Map

- Do not force mappings where none exist. It is valid for an entity to have
  no clear VSM mapping — flag it with "Mapping Strength: Weak" and explain
  the difficulty.
- Do not map purely descriptive/historical content that lacks functional
  significance.

## VSM System Checklist

When mapping, consider each system:

| System | Question to Ask |
|--------|----------------|
| S1     | Does this entity directly produce value or output? |
| S2     | Does this entity coordinate between operational units? |
| S3     | Does this entity regulate internal operations? |
| S3*    | Does this entity provide audit or verification? |
| S4     | Does this entity scan the environment or plan for the future? |
| S5     | Does this entity define identity, policy, or purpose? |

Also consider the key concepts:
- **Recursion**: At what level does this entity operate?
- **Variety**: Does this entity manage variety (attenuate or amplify)?
- **Algedonic signals**: Does this entity serve as an emergency signal?
- **Autonomy**: Does this entity relate to operational autonomy?


## Instructions

1. Review each extracted economic entity carefully.
2. For each entity, determine which VSM system(s) it most closely relates to.
3. Produce a mapping document for each entity-VSM relationship following
   the VSM Mapping Schema v1.0.
4. Each mapping document must include:
   - An H1 heading in the format "Entity Name -> VSM Concept Name"
   - An Economic Entity Reference section
   - A VSM Concept Reference section
   - A Mapping Rationale section (minimum 30 words) grounded in Beer's definitions
   - A Mapping Strength section rated as Strong, Moderate, or Weak
5. Where an entity maps to multiple VSM systems (recursion), create
   separate mapping documents for each relationship.
6. Flag entities that don't clearly map to any VSM concept with a
   "Mapping Strength: Weak" and note the difficulty in the rationale.

## Output Format

Output each mapping as a separate markdown document, delimited by
`--- MAPPING: <entity-name>-to-<vsm-concept> ---` markers.
