If, on the other hand, the law does not include specific quota requirements, then employers may find it financially profitable to create a hostile environment for class-C workers, masked by a facade of nondiscrimination. By this means they may be able to eliminate some less productive workers, whom they cannot fire without risking prosecution under the anti-discrimination regulation. Indeed, a few such workers may be deterred from applying for employment at all. Furthermore, non-class-C workers may also find it in their economic interest to contribute to this adverse environment, thereby avoiding subsidizing class-C workers as described above (p. 4.11:178). In such instances the economic motivation for such hostility against class-C persons stems directly from the anti-discrimination legislation. From an ethical viewpoint of rational egoism, of course, we may rightly regard such unjust treatment of class-C individuals with indignation. In order to rectify this intolerable situation, however, we should first address the underlying cause of the injustice—namely, the disruption of the free market by means of coercive anti-discrimination regulations.

If regulations are defined in overly vague, subjective language, then employers must make business decisions with a conservative eye to possible future charges of noncompliance. As in the case of antitrust laws, the fear of running afoul of poorly defined ordinances or incurring unexpected legal costs may cause business leaders to hesitate to take measures that would ensure a more efficient operation. In this manner, such regulations may seriously inhibit economic prosperity even if enforcement actions are relatively rare.