(Mal)adaptive Mentalizing in the Cognitive Hierarchy, and Its Link to Paranoia

Understanding the intentions of others is crucial in competitive interactions, but overanalyzing them can lead to false beliefs of malicious intent. This paper explores how Theory of Mind (ToM)—our ability to infer others’ mental states—can become maladaptive when taken too far. Through game-theoretic simulations, we show that while deep mentalizing enables strategic reasoning and deception detection, excessive mentalizing (hyper-mentalizing) leads to paranoia-like behavior.

Key findings include:

• Strategic Advantage of ToM: Agents with well-calibrated mentalizing levels can successfully anticipate and counter deception. Hyper-Mentalizing and Paranoia: Overly strategic agents misattribute simple behaviors as intentional deception, causing unnecessary skepticism and loss.
• Computational Psychiatry Implications: This work provides a formal model linking excessive ToM with paranoia and conspiratorial ideation, challenging the idea that paranoia stems from a ToM deficit.

Our findings have implications for AI, cognitive science, and psychiatry, highlighting the importance of balancing strategic thinking with accurate social inference.