LLMs Can See the Smoke but not the Fire: Evaluating Abductive Reasoning with Elenchos

Large language models (LLMs) excel at pattern recognition and text generation, but their capacity for abductive inference - inferring latent hypotheses that explain observed behavior - remains poorly understood. Here, we introduce Elenchos (named after the Socratic method of cross-examination), a generative evaluation framework that measures abductive reasoning as a structural inverse problem. Given a reference formal system, such as the lambda-calculus, and a potentially mutated counterpart, agents must determine whether a mutation has occurred and infer the rule modifications responsible for the resulting behavioral differences. Evaluating frontier and mid-tier LLMs reveals a consistent detection-attribution dissociation: models often recognize that a system has been altered but struggle to identify the latent mutations causing the observed discrepancies. Performance degrades substantially under interacting mutations, where models frequently recover only a subset of the underlying mutations. Preliminary evidence also suggests diminishing returns from increased inference-time reasoning, with only modest improvements under larger reasoning budgets, though this finding requires further validation.