Another simulation theorist Alvin Goldman supports the ideas proposed by Gordon. Goldman summarizes more clearly what the simulation theory is.
[W]e do not use mathematical decision theory (i.e. expected utility theory) to make predictions; rather, we consider what we should do if we had the relevant beliefs and desires....they [*we] ascribe mental states to others by pretending or imagining themselves to be in the other's shoes, constructing or generating the (further) state that they [*we} would be in, and ascribing that state to the other. In short, we simulate the situation of others, and interpret them accordingly.
[Goldman, A. I. (1989/1995). Interpretation Psychologized. in M. Davies and T. Stone (Eds.), Folk Psychology: The Theory of Mind Debate. Oxford: Blackwell. p.81]
According to the simulation theory, in order to understand the others, we first put ourselves in the situation of others. We imagine what we would feel, think, and do in that situation. And then, we attribute the simulation result to the others.
Now we can contrast the theory theory and the simulation theory. Theory theory is based on the observation of others from third person's perspective (as is seen in the false-belief test), and stresses the role of folk psychological theory to predict the behaviors of the others. Simulation theory is based on the subjective simulation of others from virtual first person's perspective, and stresses 'what I would do' in order to predict the behaviors of the others.
The point of disagreement between these two theories is clear.
Objective, third-person's view on the other vs. Subjective, first-person's view on the other
Which side do you take?