Language and embedding models used in RAG systems are conventionally assumed to require large-scale pretraining and explicit grounding supervision. We present B1ade, an efficient RAG architecture comprising two purpose-built components: a compact embedding model and a purpose-built SLM. B1ade-embed, a 335M parameter retrieval model constructed via parameter-free fusion of five pretrained encoders achieves top MTEB scores among sub-500M models with zero additional training, and B1ade-1B, an SLM trained on low-cost GPUs using Group Relative Policy Optimization (GRPO) on 723M tokens (2.2M examples) of curated context-question pairs with rewards that optimize only answer similarity. Our central finding is emergent attribution: despite receiving no explicit supervision for source citation, B1ade-1B cites retrieved passages in 42.4% of responses, exceeding the attribution rate of its training distribution by 5.5 percentage points. This demonstrates that grounding behavior can emerge as an accuracy-maximizing strategy under RL training, without explicit reward engineering. On standard QA benchmarks, B1ade-1B achieves 81.82% on PopQA, 65.8% on PubMedQA, and 51.09% on FEVER. In end-to-end RAG evaluation, B1ade-1B achieves an average score of 0.654 across correctness, completeness, coherence, and faithfulness, a 10.8% improvement over the SFT, while closing the gap with models 1.5x its size. These results show that strategic model composition and reward design suffice for resource-efficient RAG, without large-scale pretraining.
Retrieval-Augmented Generation (RAG) has become the standard way to ground large language models in external knowledge, yet most systems retrieve a fixed number of passages for every question regardless of its difficulty. This wastes computation on easy questions, starves hard ones, and gives no signal for when a generated answer can be trusted. With a growing share of question answering systems built on top of commercial language model APIs, a method that can decide how much to retrieve, and how far to trust its own answers, without retraining the underlying model, is of clear practical value. This paper presents AB-RAG (Adaptive Budgeted Retrieval-Augmented Generation), a training-free and backbone-agnostic framework that generates an answer, estimates its confidence from a combination of three signals, and then decides whether to stop or to retrieve more evidence, subject to a fixed retrieval budget. The estimator combines the model's own certainty, the agreement between the answer and the evidence, and the variance of the retrieval scores. For models that expose token probabilities the certainty signal is read directly; for closed APIs it is approximated by self-consistency, so the method works without access to model internals. Across three backbones and two datasets, the central result is that the confidence estimate reliably separates correct from incorrect answers on every backbone, reaching a clean split of 57.6% against 0% Exact Match between high- and low-confidence answers on a factoid dataset. The adaptive policy improves accuracy on capable backbones, and the study reports its negative and nuanced findings honestly, including a confidence signal that proved unsuitable for short answers and a retrieval signal whose sign was found and corrected through measurement. The entire study was carried out on a single consumer laptop with only a few dollars of API spend.
Retrieval-Augmented Generation (RAG) grounds Large Language Models in external knowledge, yet current evaluations rely on discrete heuristics that suffer from ''epistemic blindness'' - failing to distinguish genuine contextual information extraction from parametric memory recall. To address this, we introduce the Normalized Context Utilization (NCU) metric, leveraging continuous token log-probabilities across zero-shot, oracle, and adversarial conditions to strictly quantify contextual information gain. Evaluating architectures ranging from 1.5B to 72B parameters alongside a proprietary commercial API reveals that for strict factual extraction (without Chain-of-Thought reasoning), traditional scaling laws exhibit extreme diminishing returns: highly efficient Small Language Models (SLMs) match or outperform high-capacity architectures. Furthermore, we demonstrate that ``Prior Dominance'' correlates with model scale and proprietary alignments. The evaluated commercial API not only overrode explicit external evidence in nearly half of adversarial conflicts, but also frequently suffered from systemic confidence collapse (Negative Transfer) when its parametric priors were contradicted. Our findings highlight the structural epistemic advantage and superior contextual adherence of SLMs in strict extraction workflows.
While large language models have been dominating the research landscape recently, small language models remain highly relevant across various domains; yet, they receive far less attention. In this study, we investigate how smaller language models perform during the generation stage within a Retrieval-Augmented Generation (RAG) system. To benchmark these models effectively, we utilised both open-source and proprietary datasets covering diverse subject areas and question types. Our findings demonstrate that a RAG system with small language models can be executed directly on-device without requiring any GPU hardware within a reasonable time. The experimental code and links to the supplementary materials can be accessed through the GitHub repository: https://github.com/SibNN/SLM-RAG-EVAL.