Social ties are important in a MMORPG, they contribute a lot to the longevity of the game. But getting people to play together, especially play *nice* together, isn't that easy. Early games tried the concept of enforced grouping, where mobs were simply too hard to kill solo, and people needed to find a group for whatever they wanted to do. That turned out to highly unpopular. Not everybody wants to group all the time. Finding a group requires some unproductive wait time, and then everybody needs to stay together for some time to make the wait worth while. People just wanting a short play session, or likely to be interrupted by real life events, have problems. And in some cases you end up in a horrible pickup group, where the other players play badly and try to grab more than their fair share of the loot. So soloing is a lot more popular.
World of Warcraft did rather well with a concept of optional grouping. You can solo all the way up to the level cap, but some elite quests and all dungeons require a group. And this group content gives out better item rewards than the solo content. A solo player will be mostly dressed in "green" items, while a group player will be mostly dressed in superior "blue" items. That system worked quite well in the early days of WoW. Unfortunately in the long term there are two problems with it: The end game at the level cap has relatively little solo content and a lot more group and raid content. And the older a server gets, the fewer players are available for grouping in the lower levels, often forcing everybody to solo because there simply isn't a group to be found for the dungeon you want to go to. It can be argued that the pendulum has swung too far to the soloing side, and that people should be encouraged to group a bit more.
So how could encouraged grouping look? We don't want to make soloing impossible, or restrict it to limited content. Some people will always want to solo, for personal reasons or because of the length of their play sessions, and we need to accomodate those. What we need to look at is the middle field, the people who are deciding on whether to group or to solo based on the situation, and what is in it for them. And in a game like World of Warcraft or Lord of the Rings Online we will see that these people simply don't group because it isn't efficient. If you are on an average quest to kill ten foozles (I would have said rats, but I didn't want to infringe on somebody's copyright) you get more experience and treasure per hour if you solo the quest than if you group to do it.
The key to this the group experience bonus. If you solo a mob worth 100 xp, you get 100 xp. If you kill the same mob in a group of five players, you get 20 xp (100 divided by 5) plus the group experience bonus. That group experience bonus is relatively small in WoW, so you end up with something like 24 xp for killing that mob. So unless your group has formed instantly and then kills mobs more than 4 times faster than you would solo, you get less experience points per hour in a group than if you soloed.
This opens up great possibilities for tuning. Imagine if killing a 100 xp mob in a group gave 100 xp. As killing in a group is easier and faster than killing solo, grouping would be hugely popular. If the group bonus would be even higher, lets say 200 xp for killing a mob in a group which gives only 100 xp when solo, it would be as if grouping was required, as in a group you'd earn xp much, much faster than solo, and solo would feel like a slow grind compared to group play. Thus by tweaking only one single parameter in the game, the group experience bonus, we can go all the way from a game where everybody soloes to a game where everybody groups. All that needs to be done is to find the right level for the group bonus.
Now I don't know where the right level is. How many xp should a character get for killing a mob in a group of 5, if the same mob gave him 100 xp when soloed? I think 24 xp like in WoW is too little. 100 xp or more is too much. But you'd need a huge field experiment to find out whether the good level is 40 xp, 60 xp, or 80 xp. The bonus should be large enough for players to "risk" joining a pickup group. Yes, I know how much people hate pickup groups, but that is a viscious cycle: good players don't join pickup groups, so pickup groups are full of bad players, so playing in a pickup group is often a bad experience. If a group experience bonus would persuade even good players to join pickup groups more often, the quality of those groups would increase, and they would be less horrible. Sure, you'd get unlucky sometimes and still end up with the idiots and ninja looters. But that would be compensated by gaining more xp whenever you find a decent pickup group. And once in a while you'll find a great pickup group, and end up making new friends. And there would be the real value of making groups more popular.