Why cooperate?

Ole Peters and Alex Adamou have written a paper titled The evolutionary advantage of cooperation. Here they show how the simple and universal setting of noisy multiplicative growth predicts the formation of cooperating units — in which individual entities pool and share their resources — and, ultimately, much of the structure observed in nature and society. In the classical economic paradigm, the widespread existence of cooperation is a conundrum: successful entities make immediate losses when they share, so why do they agree to cooperate? The answer emerges naturally from the fluctuation-reducing effect of cooperation under multiplicative growth. This increases the time-average growth rate for each cooperator, conferring an evolutionary advantage.
The manuscript is available on arXiv: http://arxiv.org/abs/1506.03414

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