Psychological Distance and Algorithm Aversion: Congruency and Advisor Confidence

Employees and consumers have varying preferences between human and algorithmic advisors. Drawing on construal level theory, I hypothesize that individual differences in algorithm aversion can be explained by the perception that algorithms are psychologically farther away than human advisors. The first set of studies (n = 266) shows that algorithms are viewed as abstract and distant compared with humans, even when their outputs are perceived at a low-level construal, challenging prior research. Leveraging construal congruency, the second set of studies (n = 1,148) shows that farther within-task psychological distance generally increases preference for algorithmic advisors due to differences in advisor confidence. Specifically, I contribute to the literature by showing that a far psychological distance within a task reduces confidence in human advisors. In contrast, confidence in algorithms remains stable, increasing algorithm appreciation at farther within-task distances. History: This paper has been accepted for the Service Science Special Section on Navigating the Use of Technology in Service Marketing. Supplemental Material: The online appendix is available at https://doi.org/10.1287/serv.2023.0054 .