I was thinking of the formation of the Kings Company and Dukes Company but they were after not before this. From what I've gathered from relistening to snippets from the course and a bit of Googling the actual answer is lack of demand. London was abandoned for hundreds of years after the Romans left, then there wasn't a big interest in the arts for a long time because of other priorities like being regularly sacked/plagues/etc. I do know theatres were still kept out of the city proper once they started popping up but I can't find why other than again fear of plague.
That moral defender said that they don't employ censorship. Censorship is something the government does. No, they were going to be censored by private entities... how the turn tides... it feels like going back in time and not only because Americans began to talk about culture.
Can you point me to some literature on that? The infamous law in England that all plays had to be approved by the Lord Chamberlain (a situation which persisted until the late 1960s) dates from 1737, and thus over a century after Shakespeare’s time.
Generally, though, the monarchy of the time was quite supportive of the theatre. Just as well really, as the City of London was run by Puritans at the time and they'd gladly have shut down every one of the theatres. That's the reason they were generally built outside the City.