Incentives to Offer Algorithmic Recourse
Quick summary
arXiv:2301.12884v2 Announce Type: replace-cross Abstract: Algorithmic recourse promises to help applicants rejected by automated systems by explaining the changes needed to secure acceptance. What incentive do decision-makers, such as banks and employers, have to offer recourse? We study this question in a screening model in which recourse is both productive and selective: completing recourse improves an applicant's value to the decision-maker, but applicants differ in their cost of completion. The optimal policy is a threshold rule: reject applicants with low scores, offer recourse to an inte
Key takeaways
- arXiv:2301.12884v2 Announce Type: replace-cross Abstract: Algorithmic recourse promises to help applicants rejected by automated systems by explaining the changes needed to secure acceptance.
- What incentive do decision-makers, such as banks and employers, have to offer recourse?
- We study this question in a screening model in which recourse is both productive and selective: completing recourse improves an applicant's value to the decision-maker, but applicants differ in their cost of completion.
Why it matters
The significance is not only the legal text but how it changes product design. Decisions around “Incentives to Offer Algorithmic Recourse” may reshape data collection, model training, output accountability and market access.
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