<type name="Klarna\Ordermanagement\Controller\Api\Notification">
    <arguments>
        <argument name="logger" xsi:type="object">
            Klarna\Core\Logger\Logger
        </argument>
    </arguments>
</type>

This is a type configuration.

This configuration is for the base area. Base area configurations will apply to all the sub-applications.

This configuration tells the Object Manager that when a user wants a Klarna\Ordermanagement\Controller\Api\Notification object that the following arguments should be used in the foo object's constructor.

• $logger = new Klarna\Core\Logger\Logger (...)

<type name="Klarna\Ordermanagement\Controller\Api\Notification">
    <plugin sortOrder="1"
            name="klarnaKpNotification"
            type="Klarna\Kp\Plugin\Controller\Api\NotificationPlugin"></plugin>
</type>

This is a type configuration.

This configuration is for the frontend area. This is the area that corresponds with the cart sub-application.

This configuration also tells the object manager to use the Klarna\Kp\Plugin\Controller\Api\NotificationPlugin plugin class with Klarna\Ordermanagement\Controller\Api\Notification objects.