# kaal:claim:7314479-017

**Claim.** When selection among services depends on manipulable, non-contextual signals the selected party controls, the market for services clears on claims rather than on outcomes.

**Type.** failure  **Support.** argued

**Holds when.**

- service selection driven by self-reported or volume-based signals

**Source quote.**

> Self-reported capability, static ratings, installation counts, and volume metrics are each manipulable, and none is contextual. A component that performs well on one class of task and poorly on another carries a single undifferentiated score, if it carries one at all. The consequence is that the market for services clears on claims rather than on outcomes.

**From.** Wulf A. Kaal, *Institutional Requirements for Sovereign Local Agent Runtimes* (2026), V. The Accountability Gap, Stated Precisely, page 10

**Cite as.** Wulf A. Kaal, Institutional Requirements for Sovereign Local Agent Runtimes (2026). SSRN: https://ssrn.com/abstract=7314479

**Verify.** sha256 of source PDF `debace24a155ae924a155b1fafe98856d98cf83689feff2f87a32f1c06171ce6` at https://raw.githubusercontent.com/wulfkaal/Academic-Papers/main/papers/pdf/Kaal%20-%202026%20-%20Institutional%20Requirements%20for%20Sovereign%20Local%20Agent%20Runtimes.pdf

**Topics.** reputation, economics, risk-and-incentives

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