Profit-Based Counterfactual Explanations for Product Improvement: A Case Study of Manga Sales in Japan

Counterfactual explanations (CEs) enhance the interpretability of machine learning models by identifying the smallest change to an input required to obtain a desired output. Although CEs are conventionally formulated as a distance-minimization problem, the theoretical basis of this formulation has received limited attention. We show that a distance-minimization-based CE is mathematically equivalent to the maximum a posteriori (MAP) estimate of a Gibbs posterior within the generalized Bayes framework, specifically when a distance-based prior is used. We call this formulation the Distance-Prior Generalized Bayes CE (DP-GBCE). Building on this posterior perspective, we introduce two decision rules beyond MAP within a unified framework: a Bayes decision that minimizes expected decision loss and CVaR-CE, a risk-averse decision rule. We also propose an extension that uses Bayesian model weights to mix the posterior distributions of multiple models, thereby accounting for model multiplicity, where several models have comparable predictive performance. Finally, we define metrics for evaluating both individual CEs and the posterior distribution as a whole, and use experiments on simulated data and Google Trends data to quantify the trade-offs among the decision rules.

The increasing use of machine learning algorithms in social applications has raised concerns about fairness and transparency, leading to the development of counterfactual explanations. These explanations supports individuals to understand and potentially alter unfavorable decisions in areas such as loan applications, job selections, and more, by providing actionable changes to input features that would lead to a desired outcome. Existing methods often struggle to balance feasibility, plausibility, and computational efficiency. To address this, we introduce P$^2$CE, an algorithm for generating plausible Pareto-optimal counterfactual explanations, offering users a diverse set of optimal trade-offs between different notions of feasibility. P$^2$CE employs an auxiliary isolation forest outlier detector to ensure that explanations are in accordance with the data distribution and leverages SHAP values to obtain optimal results with short computing times, regardless of the underlying model. Our algorithm was empirically evaluated on three datasets, demonstrating superior performance in terms of both solution quality and computational efficiency compared to related techniques.

Counterfactual explanations (CE) explain model decisions by identifying input modifications that lead to different predictions. Most existing methods operate at the instance level. Distributional Counterfactual Explanations (DCE) extend this setting by optimizing an optimal transport objective that balances proximity to a factual input distribution and alignment to a target output distribution, with statistical certification via chance constrained bounds. However, DCE relies on gradient based optimization, while many real-world tabular pipelines are dominated by non-differentiable models. We propose DISCOVER, a model-agnostic solver for distributional counterfactual explanations. DISCOVER preserves the original DCE objective and certification while replacing gradient descent with a budgeted propose-and-select search paradigm. It exploits a sample-wise decomposition of the transport objective to compute per-row impact scores and enforce a top-k intervention budget, focusing edits on the most influential samples. To guide candidate generation without predictor gradients, DISCOVER introduces an OT-guided cone sampling primitive driven by input-side transport geometry. Experiments on multiple tabular datasets demonstrate strong joint alignment of input and output distributions, extending distributional counterfactual reasoning to modern black box learning pipelines. A code repository is available at: https://github.com/VALHALLA9/Discover.