Evolution of cooperation in costly institutes

We show that in a situation where individuals have a choice between a costly institute and a free institute to perform a collective action task, the existence of a participation cost promotes cooperation in the costly institute. Despite paying for a participation cost, costly cooperators, who join the costly institute and cooperate, can out-perform defectors, who predominantly join a free institute. This, not only promotes cooperation in the costly institute but also facilitates the evolution of cooperation in the free institute. A costly institute out-performs a free institute when the profitability of the collective action is low. On the other hand, a free institute performs better when the collective action's profitability is high. Furthermore, we show that in a structured population, when individuals have a choice between different institutes, a mutualistic relation between cooperators with different institute preferences emerges and helps the evolution of cooperation.