Principled Thoughts for Latent Recursive LLM Systems

Latent reasoning allows language models to carry out intermediate reasoning in continuous latent representations rather than fully externalizing it as discrete chains of thought. However, assigning credit to such latent thoughts from answer-only rewards is difficult: a single final answer mixes thought quality with answer-sampling noise. We propose \textbf{Latent Thought Credit (LTC)}, a hierarchical credit-assignment framework for latent reasoning. For each prompt, LTC samples multiple latent thoughts, fixes the context after each thought, and estimates thought-level expected reward by averaging rewards over multiple answers generated from that fixed context. LTC uses thought-level advantages to optimize the latent-thought phase, answer-level advantages to optimize the answer phase, and an advantage-weighted thought-matching objective that helps the policy reproduce high-credit latent thoughts. We instantiate LTC in a GRPO-style on-policy training framework and evaluate it across mathematical reasoning and STEM multiple-choice tasks. LTC achieves the best average accuracy among the compared methods, while ablations and fixed-context diagnostics show that multi-answer estimation reduces reward-estimation error and mitigates ambiguous or incorrect thought-level credit.

Chain-of-thought reasoning unfolds in discrete token space: each step is committed as text, errors propagate, and eliciting good traces presupposes traces to imitate. Reasoning instead in a model's continuous representation space - where intermediate states are vectors rather than words - sidesteps these constraints, but leaves open how those latent states should be computed. We approach this along two axes. First, we keep a large language model (LLM) frozen and use it for what it is already good at - modeling and decoding sequences - while a small auxiliary network supplies continuous latent thoughts as input. Second, we produce those latents by recurrence: a tiny recurrent reasoner refines them over many steps, decoupling the depth of computation from the size of the model, so that the latents are a product of iterative processing rather than a single forward pass. We instantiate this as Latent Recurrent Thoughts (LRT): a task-dedicated proposer supplies base latents, a recurrent reasoner refines them through bounded residual corrections, and the frozen LLM decodes the answer. On symbolic reasoning with answer supervision but no reasoning traces (Countdown-4, Sudoku) and on natural-language reasoning (HumanEval, MBPP, StrategyQA), LRT substantially outperforms prior frozen-decoder continuous-space reasoning methods under an identical decoder, prompt, data, and training budget, and outperforms non-thinking-mode chain-of-thought prompting on the same backbone at a small fraction of its inference compute.

Large Language Models (LLMs) increasingly rely on intermediate reasoning, yet explicit Chain-of-Thought (CoT) suffers from a linguistic space bottleneck: each thought must be decoded into tokens, causing high inference overhead. Latent reasoning moves deliberation into continuous space, but existing methods mostly learn deterministic or reward-maximizing paths, lacking a principled way to allocate probability across trajectories with different correctness and costs. We propose Latent Thought Flow (LTF), which models reasoning as variable-length continuous trajectories and trains a sampler to match a reward-induced posterior over answer quality and computation cost. We instantiate this with a continuous GFlowNet using stochastic latent transitions. To handle sparse answer supervision, we introduce an Entropy-Weighted Subtrajectory Balance objective for intermediate rewards and a reference-prior regularizer to anchor exploration. Experiments under finetuning and transfer learning settings show that LTF outperforms explicit CoT and latent reasoning baselines, improving accuracy by 9.5% while reducing reasoning length by 27.2% on average compared with strong latent reasoning baselines.