On-policy distillation (OPD) enables effective capability transfer between language models, yet the mechanisms underlying its failures are not fully understood.
Across code generation and mathematical reasoning, OPD with larger-scale teachers exhibits early loss plateaus, with an average final loss reduction of 25.1% after 200 updates, compared with 96.2% for self-RL teachers, obtained by further reinforcement learning (RL) training of the initial student.
To understand this difference, we analyze OPD as an idealized continuous-time dynamical system in the small-learning-rate limit.
Our training-log diagnostics associate these plateaus with an early decline in a gradient-based learning-signal proxy while substantial loss remains; these measurements do not establish why the underlying gradient weakens.
We further prove a local recovery guarantee for teachers sufficiently close to the initial student in a shared parameterization under regularity conditions, offering a conditional explanation for the success of self-RL teachers in our experiments.
Across runs with and without loss plateaus, we observe small relative parameter changes (0.025-0.098%) and high similarity between the student's representations before and after OPD (linear CKA $>0.98$ across layers).
These observations suggest that limited representation adaptation may contribute to learning-signal collapse, a hypothesis that remains to be tested.
Code is available at https://github.com/leizhao7/opd-learning-signals.