Ordering Papers Series, No. 01: When Compliance Stops Explaining Decisions: Why Formal Validity Loses Causal Authority Under Systemic Pressure

This working paper examines why formal compliance can lose causal authority under systemic pressure. It argues that when failure cost rises, systems no longer rank objects, actors, or decisions only by visible correctness. Instead, they reprice them according to the burden their failure may impose on the broader system. The paper develops compliance loss as an ordering problem, showing how formally acceptable objects can become exposure-bearing objects when systems shift from rule validation to viability protection. It contributes to the Ordering Papers Series by explaining how compliance can remain valid while no longer explaining institutional decisions.