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This research introduces CLEAR, an optimization framework that applies economic shadow pricing to dynamically allocate inference budgets between solvable and insolvent queries. By shifting resources away from failing attempts, the method achieves up to a 3x improvement in global accuracy under resource-scarce conditions compared to uniform allocation. For production systems facing strict computational constraints, this approach offers a theoretically grounded strategy to maximize the Pareto frontier of cost versus accuracy.
Source coveringarXiv

The Shadow Price of Reasoning: Economic Perspective on Optimal Budget Allocation for LLMs

arXiv2 min read

arXiv:2606.03092v2 Announce Type: replace Abstract: Inference-time scaling has emerged as a critical avenue for enhancing Large Language Models' performance, yet real-world deployment is constrained by strict computational budgets. In this work, we formulate inference budget allocation as a global constrained optimization problem governed by economic principles. By modeling per-query reasoning utility with a shifted-surge function, we derive an optimal allocation policy based on a global shadow price that equilibrates marginal utility under resource scarcity. Based on this theory, we propose Constrained Latent-utility Equilibrium Allocation for Reasoning (CLEAR). It performs rational abandonment and reallocates resources from insolvent queries to solvable queries near their emergence thresholds. Extensive experiments on several reasoning tasks with different traffic streams demonstrate that CLEAR significantly improves the Pareto frontier of total token cost versus mean accuracy. In resource-scarce regimes, CLEAR achieves up to a 3x improvement in global accuracy compared to uniform allocation.

Abstract:Inference-time scaling has emerged as a critical avenue for enhancing Large Language Models' performance, yet real-world deployment is constrained by strict computational budgets. In this work, we formulate inference budget allocation as a global constrained optimization problem governed by economic principles. By modeling per-query reasoning utility with a shifted-surge function, we derive an optimal allocation policy based on a global shadow price that equilibrates marginal utility under resource scarcity. Based on this theory, we propose Constrained Latent-utility Equilibrium Allocation for Reasoning (CLEAR). It performs rational abandonment and reallocates resources from insolvent queries to solvable queries near their emergence thresholds. Extensive experiments on several reasoning tasks with different traffic streams demonstrate that CLEAR significantly improves the Pareto frontier of total token cost versus mean accuracy. In resource-scarce regimes, CLEAR achieves up to a 3x improvement in global accuracy compared to uniform allocation.

Artificial Intelligence (cs.AI)

arXiv:2606.03092 [cs.AI]

(or arXiv:2606.03092v2 [cs.AI] for this version)

https://doi.org/10.48550/arXiv.2606.03092 Focus to learn more arXiv-issued DOI via DataCite

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Full text under the publisher's open licence · 233 words

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