LEGAL RULES AND SOCIAL NORMS IN JAPAN SECRET WORLD OF SUMO

Members of the Japan Sumo Association, the organization that governs p rofessional sumo wrestling, have developed a complex web of formal leg al rules and informal social norms outside of the usual confines of th e law to structure and define their relationships. The core of this or ganizational structure is the rules and norms that govern the ownershi p and transfer of 105 shares of so-called elder stock. The elder-share -based organizational structure maximizes group welfare in two ways. F irst, the constitutive rules and norms that make up the elder share re gime tend to maximize the aggregate welfare of the group. Second, with in the elder share regime, the Sump Association's choice Of whether to apply rules or to defect to norms is based on a calculation of compar ative efficiency.