THE IMPACT OF CAPITAL MARKET MISPRICING ON THE FINANCING CHOICE FOR CORPORATE WITH DIFFERENT FINANCIAL CONSTRAINTS

China's capital market has been non-effective for a long time, and the prices of securities have been subject to frequent abnormal changes. Capital markets is an important financing place for the real economy. The mispricing of the capital market will inevitably have an impact on the listed companies' equity and debt financing. This paper takes China's listed companies as the research object, using the annual financial data of listed companies in China A stock market from 2006 to 2015, using discretionary accrued profits and dividend payout as a measure of market mispricing and corporate financial-constraints respectively to explore the impact of the capital market mispricing on the financing choice for companies with different financial-constraints. The results show that mispricing has a significant positive effect on companies' equity financing and debt financing regardless of financial constraints. Specifically, we find that the positive effect of mispricing on equity financing of high financial-constraints companies is lower than that of low financial-constraints companies. However, for debt financing, the result is opposite.