The input variables (in perkun/wlodkowic/zubr) represent what is directly perceived. The hidden variables used to construct the agent's state represent something the agent believes. What we believe may be more important than what we can see. The hidden variables can be used to model unknown parameters of the world, the hidden processes running beneath the surface of the visible. All in all the hidden variables are a tool to represent compactly the past, the history.