A recent innovation in equity markets is the introduction of market maker services paid for by the listed companies themselves, such as the Market Quality Program introduced in 2013 by NASDAQ. Using data from the Oslo Stock Exchange, we investigate what motivates issuing firms to pay a cost to...

In the recent financial crisis we saw the liquidity in the stock market drying up as a precursor to the crisis in the real economy. We show that such effects are not new, in fact we find a strong relation between stock market liquidity and the business cycle. Stock market liquidity worsens when...