Evolutionary biology is probably too big a subject to do justice in brief
emails shot back and forth, but here is some relative info on individual vs
group and/or species selection. Note particularly the implications of group
selection in the parasite that is mentioned.

* Selection at the level of individual organism

Selection at the level of the organism can be described as Darwinism, and is
well understood and considered common. When a gazelle, for instance, has a
trait that allows it to run faster than others and therefore to avoid
predators more effectively so that ultimately it manages to stay alive
longer and reproduce over more breeding seasons, the causation of the higher
fitness of this gazelle can be accounted for fully only if one looks at how
individual gazelles fare under predation so one can come to the conclusion
that the faster gazelle's speed allows it to avoid predation better.

* Selection at the level of the group

Specific syndromes of selective factors can create situations in which
groups are selected because they display group properties which are
selected-for. Some mosquito-transmitted rabbit viruses, for instance, are
only transmitted to uninfected rabbits from infected rabbits which are still
alive. This creates a selective pressure on every group of viruses already
infecting a rabbit not to become too virulent and kill their host rabbit
before enough mosquitoes have bitten it, since otherwise all the viruses
inside the dead rabbit would rot with it. And indeed in natural systems such
viruses display much lower virulence levels than do mutants of the same
viruses that in laboratory culture readily outcompete non-virulent variants
(or than do tick-transmitted viruses since ticks do bite dead rabbits).

* Species selection and selection at higher taxonomic levels

That selection can operate at and above the level of species remains
controversial among biologists. One particular defender of the idea of
species selection is S.J. Gould who has proposed the view that there exist
macroevolutionary processes which shape evolution at and above the level of
species and are not driven by the microevolutionary mechanisms that are
stressed by the Modern Synthesis. 

If one views species as individuals that replicate (speciate) and die (go
extinct), then species could be subject to selection and thus could change
their occurrence over geological time, much as heritable selected-for traits
change theirs over the generations.

For evolution to be driven by species selection, however, the patterns of
differential persistence of species over geological time must be the result
of selection for species-intrinsic properties rather than for properties of
genes, cells, individuals, or populations of the species involved. 

In other words, species must be shown to have been units of selection whose
properties were directly evaluated by selection. While the fossil record
clearly shows differential persistence of species, examples of
species-intrinsic properties subject to natural selection have been much
harder to document.

SOURCE:

http://en.wikipedia.org/wiki/Unit_of_selection

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