Regulations can distort market incentives from "summary" of The Antitrust Paradox by Robert Bork
Regulations, by their very nature, impose constraints on market participants. Whether in the form of price controls, production quotas, or licensing requirements, regulations shape the incentives facing businesses and consumers. When regulations are imposed on a market, they can disrupt the natural workings of supply and demand, leading to inefficiencies and unintended consequences. In many cases, regulations are put in place with the intention of correcting perceived market failures or promoting certain social goals. However, these regulations can often have the opposite effect, distorting the incentives that drive market participants to allocate resources efficiently. For example, price controls may lead to shortages or surpluses, as suppliers have less incentive to produce goods at a regulated price. Furthermo...
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