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In this paper, we study the cooperative strategies of relay stations in wireless relay networks. In such networks, relay stations distributed across the network and centrally controlled by the base station can be exploited to form cooperative antenna arrays. We show that via relay station cooperation, the achievable downstream rate of mobile stations can be enhanced. Thus, we determine which relay stations should cooperate with one another and which mobile stations should receive data from the cooperative relays such that the performance of the entire network can be optimized. The utility maximization relay station cooperation problem is formulated with the goal of maximizing system capacity and balancing user traffic demand. We analyze the complexity of this problem and show that it can be decomposed into two NP-hard sub-problems. To tackle this problem, we propose two algorithms with different degrees of efficiency and complexity. The simulation results show that relay station cooperation can not only enhance the throughput of the network, but also improve fairness among users. More importantly, we find that proper relay station placement can further enhance the throughput gain.