Summary: As \textit{R. A. Posner} [Social norms and the law: An economic approach, Am. Econ. Rev. 87, 315-369 (1997)] has observed, when individuals in a relationship can commit to imposing costs upon each other then efficient behavior in the absence of law is possible. The question is whether efficient norms of behavior evolve endogenously in a population. We show that in a standard hold up model in which both parties make relationship specific investments the long run outcome of a stochastic adaptation process similar to Young's `adaptive play' does not in general correspond to the efficient equilibria. As \textit{S. J. Grossman} and \textit{O. D. Hart} [The cost and benefits of ownership: A theory of vertical and lateral integration, J. Political Econ. 94, 619-719 (1986)] observe, institutions, such as firms, may be needed to improve the allocation of resources.