Memory Tax: Dissecting the Net Value of Agent Memory

Explicit memory systems transform conversation history into persistent representations intended to improve future access, often at substantial construction cost. Yet it remains unclear whether this added complexity yields better answer accuracy than retrieving directly from raw history. This study compares six state-of-the-art explicit memory systems with raw-history RAG on LongMemEval-S and BEAM-100K under original and controlled retrieval settings. We find only localized gains for particular question types and tight run-time context budgets, with no consistent advantage over strong raw-history RAG baselines. Oracle retrieval shows that some systems fail to preserve answer-supporting information during explicit memory construction, while others preserve it but fail to retrieve it effectively, despite construction costs reaching hours per conversation. Our findings suggest that while many existing memory systems for AI agents emphasize increasingly elaborate explicit memory construction, they are often evaluated without strong controlled comparisons to raw-history RAG and may underemphasize retrieval. Retrieval remains a major bottleneck when useful information is preserved, suggesting that improving access to existing information may be at least as important as constructing richer explicit memory.

Agents today often take real-world actions that depend on long-term memory and context recall over time. However, most current memory benchmarks are built for a conversational question-answer format, where the question itself signals that some fact must be retrieved, and often which one. Moreover, benchmarks rarely require anything beyond accuracy from submissions, allowing memory systems to make unreasonable cost/time tradeoffs to achieve higher scores. We present DolphinBench, a benchmark that evaluates memory directly through an agent's task completion. DolphinBench includes three knowledge-work personas with roughly 500k tokens of user messages per persona and evaluates agents on tasks that depend on information from that history. We verify all 200 tasks per persona by running an agent with and without the relevant history, requiring success with it and failure without it. Finally, we require all evaluations to report total cost and latency alongside accuracy, which enables us to evaluate agent memory systems holistically. No existing memory benchmark combines all three. The dataset and evaluation code are available at https://dolphinbench.ai.

Memory is becoming core infrastructure for long-horizon LLM agents, yet existing evaluations offer limited guidance on which memory substrate, namely the underlying medium in which memory is represented and stored, should be used under different operating regimes. We present a controlled harness evaluation of memory substrates for memory-augmented agents, covering dense and sparse indices, text records, structural stores, hierarchical stores, refinement-based memories, parametric updates, and activation-compatible context mechanisms. Across three backbone models and four benchmark suites spanning user-centric question answering and agent-centric decision-making, we instrument 26 performance and efficiency metrics under a unified harness. Our results show that no single substrate consistently dominates: broad retrieval benefits long-context factual QA, while excessive retrieval can harm sequential decision-making by shifting attention away from action-critical context. Scalability introduces a further routing axis, as substrates that perform well at moderate history lengths can become costly or brittle at longer horizons. These findings motivate substrate routing as a necessary component of adaptive agent memory systems and provide empirical guidance for designing efficient, reliable, and regime-aware long-term memory for LLM agents. Code will be made available upon acceptance.