Industrial Policy Analogy: Certificate of Need Laws, but it’s start-up restaurants vs incumbent Big Chains

In the mid-1980s, lawmakers realized the negative impact of certificate of need laws and repealed them, however, almost every state had enacted these laws by that time. The laws benefitted entrenched incumbents with influence on the certificate of need commissions, as they could prevent new entrants. The analogy of these laws to the restaurant industry illustrates how start-up restaurants with innovative concepts could be rejected by a commission influenced by existing restaurant owners, especially large corporate entities.