Pathwise-Budgeted LLM Routing: Online Allocation with K-Bit Tail-Cost Learning

Large language models (LLMs) achieve impressive performance across multiple domains, but using the most capable model for every query is prohibitive at scale. LLM routing exploits diversity in model capability and cost by assigning each query to a suitable model to balance utility and budget. Current methods have two limitations: (i) they either use heuristics that do not always enforce the budget constraint or impose a fixed per-query budget that cannot adapt across the workload and leads to suboptimal performance; (ii) they require supervised learning on a dense dataset with statistics for every query-model pair, which is expensive to collect. To address these challenges, we formulate LLM routing as a constrained contextual multi-armed bandit problem and introduce WISERouter (WR for short), a framework that supports offline learning from historical interactions as well as online learning with exploration. We further prove that WR-Online achieves a sublinear regret bound of $O(\sqrt{T})$ over a time horizon $T$. Empirical results on RouterBench and SWE-Bench demonstrate that (i) WR-Offline surpasses existing baselines in performance under a fixed budget and adheres more closely to budget constraints, and (ii) WR-Online achieves comparable performance to the baselines, while using substantially less exploration data.

Multi-model LLM serving operates in a non-stationary, noisy environment: providers revise pricing, model quality can shift or regress without notice, and new models arrive regularly. More than a dozen recent methods have proposed learned routers to navigate the resulting quality--cost tradeoff across portfolios spanning a $\sim$530$\times$ cost range. Despite this activity, two gaps in the current solution space limit routing effectiveness under these conditions: no existing router enforces a dollar-denominated cost ceiling in closed loop over an open-ended request stream, and none provides principled online adaptation to post-deployment shifts in pricing or model quality. We present ParetoBandit, an open-source adaptive router built on cost-aware contextual bandits that addresses both gaps. Its core contributions are: (1) an online primal--dual budget pacer that enforces a per-request cost ceiling without a known horizon, and (2) geometric forgetting on sufficient statistics that gives the bandit bounded memory for tracking quality and cost shifts. A hot-swap model registry further supports runtime model changes with budget-controlled exploration. On 1,824 benchmark prompts with a three-model portfolio, the router maintains budget compliance within 0.4%, adapts to price and quality shifts with up to +0.071 quality lift, and integrates a cold-started model within $\sim$142 steps.

A multi-model language service must route each request while preserving workload-level budgets for compute, latency, memory, or monetary cost. Two features make this problem materially harder than static model selection. Prompt representations are high dimensional, so only a small subset of embedding directions may predict the incremental value of a model, and both the request mix and the model frontier drift after launches, fine-tunes, quantization changes, and system updates. We formulate nonstationary sparse contextual routing with multiple knapsack constraints and an optional shadow-audit stream that evaluates a small fraction of prompts on several models. We propose Drift-Aware Sparse Routing (DRS). The policy estimates reward and resource use from a rolling audit window, routes using pessimistic reward and optimistic cost estimates, updates resource shadow prices online, and applies a hard meter before commitment. The analysis separates control from statistics. On any event with uniform prediction radii $\{β_t\}$, regret against a paced dynamic fluid benchmark is bounded by the sum of the radii, a capacity-buffer term, and an $O(\sqrt{T})$ pacing term. Under a sparse linear model and bounded drift $V_T$, rolling estimation gives $$\widetilde O\left( T\sqrt{\frac{s}{ρW}}+WV_T+\sqrt{T} \right),$$ where $s$ is sparsity, $ρ$ is the audit rate, and $W$ is the window length. Optimizing $W$ yields the usual stationary $O(\sqrt{sT/ρ})$ rate when $V_T=0$ and a $O(T^{2/3}(s/ρ)^{1/3}V_T^{1/3})$ adaptation term under drift.