Until you compare to Asian countries where you can visit nice restaurants if you're so inclined, but you also have abundant choice of street food and little diners, which aren't super clean but are cheap and tasty. This also changes the economy - it doesn't take hundreds of thousands of dollars to open a restaurant and obtain the proper licensing, which means that new locations can spring up for cheap. Which means there's an extra source of jobs for people at the bottom of the economy, and so on.
Multiply that by every regulated industry and you start to see the real downsides to gov't control of private enterprise. This has been abundantly studied, contrary to your post. As well as ample evidence, there's also the fundamental principle - govt is not a productive enterprise and so nothing it does can help businesses produce things of value. All it can (and should) do is define laws to protect everyone - this covers things like fraud, but not decreeing what products can and cannot be sold.