Large language models (LLMs)  have come closest among all models to date to mastering human language, yet opinions about their linguistic and cognitive capabilities remain split. Here, we evaluate LLMs using a distinction between formal linguistic competence—knowledge of linguistic rules and patterns—and functional linguistic competence—understanding and using language in the world.
We ground this distinction in human neuroscience, showing that formal and functional competence rely on different neural mechanisms. Although LLMs are surprisingly good at formal competence, their performance on functional competence tasks remains spotty and often requires specialized fine-tuning and/or coupling with external modules. In short, LLMs are good models of language but incomplete models of human thought. * The two lead authors contributed equally to this work.