Feedback-Induced Performance Decline in LLM-Based Decision-Making

Abstract: The ability of LLMs to extract context from natural language problem descriptions naturally raises questions about their suitability in autonomous decision-making settings. This paper studies the behaviour of these models within a Markov Decision Process (MDPs). While traditional reinforcement learning (RL) strategies commonly employed in this setting rely on iterative exploration, LLMs, pre-trained on diverse datasets, offer the capability to leverage prior knowledge for faster adaptation. We investigate online structured prompting strategies in sequential decision making tasks, comparing the zero-shot performance of LLM-based approaches to that of classical RL methods. Our findings reveal that although LLMs demonstrate improved initial performance in simpler environments, they struggle with planning and reasoning in complex scenarios without fine-tuning or additional guidance. Our results show that feedback mechanisms, intended to improve decision-making, often introduce confusion, leading to diminished performance in intricate environments. These insights underscore the need for further exploration into hybrid strategies, fine-tuning, and advanced memory integration to enhance LLM-based decision-making capabilities.