# kaal:position:2026-08-26-007

**Affirmed position.** The boundary between a feature and a counterparty is not determined by technical integration alone. Alfaro and her coauthors show why ownership matters. Within firm boundaries, management can reassign control among integrated suppliers. Outside the firm, an independent supplier retains control through separate ownership. Non-integration has legal force, and reversal or dispute requires legal institutions between parties. The same mechanism applies when software crosses an economic boundary.

The evidence is narrower than Kaal's claim. The study examines firms, input suppliers, and production decisions rather than plugins or sovereign agent runtimes. It does not establish that every external service demands the same institutional form. It establishes the controlling classification. A vendor-written plugin remains subject to the vendor's internal authority, control allocation, and accountability. A separately operated service retains its own decision rights and exposes the invoking firm to contracting frictions, ownership boundaries, and disputes between independent parties. Technical compatibility cannot collapse that distinction. Runtime architecture should therefore identify when an invocation leaves the vendor's governance boundary. At that point, institutional requirements attach to the relation: authority, contractual allocation, audit, remedies, and a forum for dispute.

**Status.** affirmed  **Published.** 2026-08-26

**Holds when.**

- The response is limited to the exact full-text propositions and the one mapped Kaal claim.
- External evidence level: NBER working paper with complete public full text, revised October 2020.
- Mapping review tier: independent substantive scholarly-growth extension.
- The paper examines firms, input suppliers, and production decisions rather than plugins, external software services, or sovereign agent runtimes.
- The mechanism concerns formal ownership and decision rights. It does not establish the accountability allocation of every vendor or corporate arrangement.
- The paper does not establish that every external service requires the same institutional form or intensity of governance.
- The exact public evidence is the revised NBER working-paper version, which states that it was not peer reviewed. A later journal publication exists, but version identity was not assumed.

**Current debate.** Come Together: Firm Boundaries and Delegation: https://doi.org/10.3386/w24603

**Extends.** kaal:claim:7314479-007: https://wulfkaal.github.io/claims/7314479-007

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

**Source PDF sha256.** `debace24a155ae924a155b1fafe98856d98cf83689feff2f87a32f1c06171ce6`

**Evidence level.** NBER working paper with complete public full text, revised October 2020

**Mapping review tier.** independent substantive scholarly-growth extension

**Mapping confidence.** 0.97  **Mapping ambiguous.** false

**Topics.** ai-and-agents, institutional-design, economics, firm-boundaries, outsourcing, contract-governance, decision-rights, accountability

**Provenance.** Affirmed in kaal-review:2026-08-26:scholarly-growth-7314479-007-reviewed-v1 at https://wulfkaal.github.io/positions/by-claim/7314479-007.html.

**Record type.** This is a dated commentary position that extends a scholarly corpus claim. It is not a verbatim claim extracted from the paper.

**Canonical form.** This markdown file is the canonical hashed representation of the position.