| Summary: | Abstract Two seemingly unrelated, but fundamental challenges in evolutionary theory, are the evolution of costly signals and costly cooperative traits, both expected to reduce an individual’s fitness and diminish by natural selection. Here, by considering a well mixed population of individuals who produce signals and decide on their strategies in a game they play, based on the signals, we show that costly signals and costly cooperative strategies can co-evolve as a result of internal dynamics of the system. Costly signals evolve, despite their apparent cost, due to a favorable cooperative response they elicit. This favorable strategic response can be quantified in a fitness term which governs the distribution of costly signals better than their apparent cost. In the same way, cooperative strategies evolve as they can reach a high fitness due to the internal dynamics of the systems.
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