Does the KZ Index Provide a Useful Measure of Financial Constraints?* Charles J. Hadlock Michigan State University hadlock@msu.edu Joshua R. Pierce University of South Carolina piercej@moore.sc.edu This Draft: March 5, 2008 *We thank Sreedhar Bharath, Murillo Campello, Jonathan Carmel, Ted Fee, Jun-Koo Kang, Michael Mazzeo, Uday Rajan, David Scharfstein, and seminar participants at Michigan, Pittsburgh, and South Carolina for helpful comments and suggestions. Tehseen Baweja and Randall Yu provided superb research assistance. All errors remain our own.