How financial markets should be structured and regulated is one of the central questions of modern finance. Although theory provides some guidance, the microstructure of contemporary stock exchanges is sufficiently varied and complex that it is difficult to determine the optimal set of rules for an efficient marketplace. During the formative years of the Paris Bourse [Stock Exchange], the government radically altered the financial architecture of the exchange several times. These changes provide a natural experiment to examine the importance of entry restrictions and the size of security issues for the delivery of liquidity. In contrast to the stock exchanges in London and New York, government, not private interests, created the Paris Bourse in 1724. Initially, the Crown's role in the establishment of a stock exchange arose out of its financial difficulties and reflected the hope that an exchange would improve the market for government securities. From a bourse with a fixed number of brokers trading relatively small issues, the French Revolution produced a new exchange where large issues were traded by an unrestricted number of brokers. Napoleon altered this mix by reducing and limiting the number of agents in the market. The concern of successive governments about the microstructure of the bourse in an changing economic environment produced a continuing search for advantageous exchange rules. However, a liquid market was formed not only by the regulations and structure set by the government but also by the operations of bankers and other large participants, acting at least partly as market makers.