It's bad for society to have rapid turnover full stop. It's disruptive and stressful to the humans involved and can be disastrous for the environment (if a bankrupt company just leaves a bunch of waste behind or already did and can't be sued to cover the cleanup), disastrous for the rest of the economy, local or larger (both their customers and their suppliers are affected), and causes a huge amount of wasted time and resources that should be avoided where possible.

We've learned that businesses are lazy, cheap, and untrustworthy, and will lie, steal, cheat, and abuse everything unless you write strong rules and enforce them regularly. It's in society's best interests to incentivize running good businesses, not creating messes and declaring bankruptcy.