MDL Meets Latent Confounders: LNML-based Causal Discovery

arXiv:2607.04133v1 Announce Type: new Abstract: Causal discovery with nonlinear mechanisms and latent confounders remains challenging. Existing methods often rely on either linear assumptions or causal sufficiency, limiting their applicability. We propose an MDL-based causal discovery framework that explicitly accounts for latent confounders while allowing flexible nonlinear mechanisms by minimizing the luckiness normalized maximum likelihood (LNML) code-length. The causal relationship between each variable pair is determined by selecting the shortest code-length of the causal model, and we introduce the notion of Delta-pseudo-collinearity to identify dependencies induced by latent confounders. Based on these ideas, we develop a greedy algorithm, termed Pseudo-Collinearity Guided Causal Discovery (PCG-CD). Experiments on synthetic and real-world datasets demonstrate that the proposed method accurately recovers directed causal relationships and effectively detects latent confounders.

Source: arXiv cs.LG | 2026-07-07