[anigbrowl]

You're assuming the government initiates regulation. In reality, merchants and artisans tend to form into guilds and then demand new entrants to that market be licensed. Adam Smith noted this phenomenon in The Wealth of Nations in the famous passage: 'People of the same trade seldom meet together, even for merriment and diversion, but the conversation ends in a conspiracy against the public, or in some contrivance to raise prices. It is impossible indeed to prevent such meetings, by any law which either could be executed, or would be consistent with liberty and justice. But though the law cannot hinder people of the same trade from sometimes assembling together, it ought to do nothing to facilitate such assemblies; much less to render them necessary.'

A more recent treatment of the subject appears in nplusone magazine, but the site is down just at the moment: http://nplusonemag.com/death-by-degrees Another recent example from NPR: http://www.npr.org/blogs/money/2012/06/21/154826233/why-its-... (you'll be happy to know that Clayton recently won her court case, and plans to reopen her business).