Improving Latent Generalization Using Test-time Compute
On the map: LLM reasoning → Test-time compute and efficient thinking
Abstract (arXiv)
Language Models (LMs) exhibit two distinct mechanisms for knowledge acquisition: in-weights learning (i.e., encoding information within the model weights) and in-context learning (ICL). Although these two modes offer complementary strengths, in-weights learning frequently struggles to facilitate deductive reasoning over the internalized knowledge. We characterize this limitation as a deficit in latent generalization, of which the reversal curse is one example. Conversely, in-context learning demonstrates highly robust latent generalization capabilities. To improve latent generalization from in-weights knowledge, prior approaches rely on train-time data augmentation, yet these techniques are task-specific, scale poorly, and fail to generalize to out-of-distribution knowledge. To overcome these shortcomings, this work studies how models can be taught to use test-time compute, or 'thinking', specifically to improve latent generalization. We use Reinforcement Learning (RL) from correctness feedback to train models to produce long chains-of-thought (CoTs) to improve latent generalization. Our experiments show that this thinking approach not only resolves many instances of latent generalization failures on in-distribution knowledge but also, unlike augmentation baselines, generalizes to new knowledge for which no RL was performed. Nevertheless, on pure reversal tasks, we find that thinking does not unlock direct knowledge inversion, but the generate-and-verify ability of thinking models enables them to get well above chance performance. The brittleness of factual self-verification means thinking models still remain well below the performance of in-context learning for this task. Overall, our results establish test-time thinking as a flexible and promising direction for improving the latent generalization of LMs.
Key facts. No citing papers in the map yet (data through 7 Oct 2026). Placed in Test-time compute and efficient thinking, one of 17 directions in LLM reasoning. Builds on 20 of its 29 references that are in the map. First posted on arXiv 1 Apr 2026.
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20 of 29 references.
References · 20
- 2025DeepSeek-R1: Incentivizing Reasoning Capability in LLMs via Reinforcement Learningcited by 6,146
- 2025Gemini 2.5: Pushing the Frontier with Advanced Reasoning, Multimodality, Long Context, and Next Generation Agentic Capabilitiescited by 3,655
- 2023Let's Verify Step by Stepcited by 3,598
- 2024OpenAI o1 System Cardcited by 1,220
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- 2023Taken out of context: On measuring situational awareness in LLMscited by 131
- 2022Recitation-Augmented Language Modelscited by 65
- 2024Synthetic continued pretrainingcited by 56
- 2024Reverse Training to Nurse the Reversal Cursecited by 48
8 more
- 2025On the generalization of language models from in-context learning and finetuning: a controlled studycited by 39
- 2025Learning to Reason for Factualitycited by 22
- 2025Text Data Augmentation for Large Language Models: A Comprehensive Survey of Methods, Challenges, and Opportunitiescited by 21
- 2025Latent learning: episodic memory complements parametric learning by enabling flexible reuse of experiencescited by 14
- 2026Thinking to Recall: How Reasoning Unlocks Parametric Knowledge in LLMscited by 13
- 2023Tell, don't show: Declarative facts influence how LLMs generalizecited by 8
- 2026Improving Parametric Knowledge Access in Reasoning Language Modelscited by 4
- 2025textitNew News: System-2 Fine-tuning for Robust Integration of New Knowledgecited by 1
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- 2025Seek in the Dark: Reasoning via Test-Time Instance-Level Policy Gradient in Latent Space
- 2025How and Why LLMs Generalize: A Fine-Grained Analysis of LLM Reasoning from Cognitive Behaviors to Low-Level Patterns
- 2026Prioritize the Process, Not Just the Outcome: Rewarding Latent Thought Trajectories Improves Reasoning in Looped Language Models
- 2026Why Does Reinforcement Learning Generalize? A Feature-Level Mechanistic Study of Post-Training in Large Language Models
- 2024Language Models are Hidden Reasoners: Unlocking Latent Reasoning Capabilities via Self-Rewarding
- 2026Unrewarded Exploration in Large Language Models Reveals Latent Learning from Psychology
- 2025Thinking on the Fly: Test-Time Reasoning Enhancement via Latent Thought Policy Optimization
- 2020Learning to Generalize for Sequential Decision Making