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In recursive modeling (I think that you think...), agents eventually hit a cognitive limit. It’s a logical trap - humans can't just "think harder" forever. It might also be the case that humans infrequently want to avoid using recursive strategies when they can -

It augments agents with and ℵ-IPOMDP mechanism: 1. Anomaly Detection mechanisms: "My predictions are consistently wrong." 2. Out-of-Belief Policy: A severely 'defensive' response. In effect: 'I don't know _how_ you're tricking me, but I know you are, so stop or we'll both suffer'

With this, more equitable social outcomes are achieved, and exploitation is reduced when compression & expectation are tuned within normal bounds. It provides a plausible, mechanistic formal framework in which agents can compete without recursion.