You get the same in football. Teams like Chelsea are effectively puppy farming. They scoop up all the promising youngsters, then loan them out and sell them at profit after they've impressed for their loan side. If they weren't allowed to do it, those players would thrive at lower clubs, earning them a good fee when sold on nearer their peak.
The problem in both sports, is the smaller clubs beg for scraps from the big boys table, whereas if they didn't the big boys couldn't hoover up all the talent. Short term thinking.