We demonstrate that the severity of financial constraints has declined over time due to two reasons: (i) improved access to external funds as evidenced by a decreased reliance on internal cash flows, and (ii) an inward shifting investment frontier with reduced investment opportunities. The decline in financial constraints coincides with the documented diminishing sensitivity of investment to cash flows, yet we show that cash flows remain a determining factor for constrained firms in helping them overcome restricted access to external capital. We also document a flight-to-quality during economic shocks, where the adverse effects following these periods of tightened credit are particularly pronounced for smaller firms, while larger firms appearing largely unaffected.