Strategic reasoning is the computational process of making decisions by explicitly modeling the likely decisions of other rational or boundedly rational agents who are also modeling you. It moves beyond single-agent optimization to game-theoretic scenarios, where an agent's optimal action depends on predicting the actions of others, who are simultaneously trying to predict its actions. This often involves recursive modeling (e.g., "I think that you think that I think...") and is foundational for AI in negotiation, economics, and adversarial environments.
