Why does having a dislocated shoulder limit one's movement of the arm?

Variable: Stiffness, spasm, stretch and pain of the capsule, internal derangement, torn rotator cuff.

The shoulder: Is a ball and socket joint. If the ball is not in socket then it means that it is in the wrong place and moving against the wrong bone surface. Muscles tendons and ligaments are damaged or distorted so they can't work properly and the ball could be blocked from any significant movement because it is dented or pushing up against another bone.