Working Papers

Denied by an (Unexplainable) Algorithm: Teleological Explanations for Algorithmic Decisions Enhance Customer Satisfaction

Geoff Tomaino

INSEAD

Hisham Abdulhalim

Ben-Gurion University of the Negev

Pavel Kireyev

INSEAD

Klaus Wertenbroch

INSEAD

Dec 29, 2020

Uses a field experiment with a technology firm and several online lab experiments to demonstrate when mechanistic (“how”) and teleological (“why”) explanations can enhance customer satisfaction with algorithm-based decisions. Participants perceive teleological explanations as fair, even when an algorithm with a fair goal employs an unfair mechanism.

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