I'm definitely looking for a system where agent can see the other, although just simulating doesn't seem robust enough. I don't understand all the terms here but the gist of it looks as if there isn't a solution that everyone finds satisfactory? As in, there's no agent program that properly matches human intuition?

I would think that the best agent X would cooperate iff (Y cooperates if X cooperates). I didn't see that exactly.. I've tried solving it myself but I'm unsure of how to get past the recursive part.

It looks like I may have to don a decent amount of research before I can properly formulize my thoughts on this. Thank you for the link.