ATM: Why Latent World Models Can Fail to Plan

Abstract

Latent world models can achieve accurate latent prediction yet still differ substantially in downstream planning performance. We argue that a key source of this discrepancy lies in the structure of action-induced latent transitions. We formalize action-identifiability through Bayes inverse risk, characterizing how much uncertainty about an action remains after observing the transition it induces. Model-predicted transitions can become highly self-decodable while encoding a domain-specific action relationship that fails to transfer to real environment transitions. We characterize this mismatch through cross-domain inverse transfer, instantiated as the Action-Consistency Transfer Matrix (ATM), a $2\times2$ inverse-risk matrix over real and predicted transition domains. Across TwoRoom, PushT, and OGBench-Cube, true-transition action-identifiability tracks downstream planning substantially better than standard prediction loss, while the full ATM reveals highly self-decodable yet cross-domain-inconsistent predicted transitions. Controlled interventions on the two domains further produce distinct transition structures and planning outcomes, supporting this decomposition. The same diagnostics also support lightweight model screening, reaching 98.81\% pairwise ranking accuracy for candidates separated by more than 5\% success.