The Cage: How Fiduciary Duty Creates Organizational Incompleteness

Formalization enables scale but creates frames that compress reality into legible metrics. Under fiduciary law, boards must demonstrate prudence, pushing organizations toward defensible decisions rather than correct ones. Version 2.0: Merged with former Paper 17 (Empirical Analysis of Linguistic Variance Compression). Now includes full empirical evidence from SEC filings: OLS regression across 20 companies/60 filings shows lexical diversity declines -0.012/year post-IPO (p<0.001, R²=0.798). Legal Amplifier adds -0.010 LD/year (85% amplification). Within-document genre confound controls. Born Caged formalized as Corollary 1.1. Institutional theory engagement (DiMaggio & Powell, Meyer & Rowan, Scott).