It's not paradoxical and the attitude expressed by GP that it's not "rational" is exactly the sort of thinking that leads to rationality getting a bad name.
Cooperation to the detriment of the individual in the animal world is exactly the same phenomenon in a much simpler system. That is widely and repeatedly evolved so we know for a fact that the game theory works out in a vacuum (ie without human cultural factors).
Any high trust cultural behavior is similar.
Animal cooperation proves that game theory is universal, but it does not prove it works in a vacuum for humans.
- Biology gives us the instinct to cooperate and the capacity for empathy.
- Capitalism provides the mechanism to scale that cooperation to millions of strangers.
- Institutions (laws/culture) provide the rules that prevent the "vacuum" from devolving into a state where the strongest exploit the weakest (which is actually what happens in nature when policing fails).
Therefore, in a capitalistic society, cooperation to the detriment of the individual (e.g., paying taxes, following labor safety rules) is not just a biological imperative; it is a social contract enforced by culture to allow the complex system to function. Without the cultural layer, the biological layer alone is insufficient to sustain a modern economy.