Abstract
Many experts consider family caps to be the one welfare reform explicitly designed to reduce birth rates among poor unmarried women. Despite the operation of such caps in 23 states, research reports mixed findings on the policy's effectiveness in reducing non-marital births. This article presents results from a national study in which family caps were found to affect fertility behavior, but this effect was conditioned by a state's willingness to use Medicaid to fund abortions deemed necessary to protect the health of the mother, as well as by the percentages of black and Hispanic women (ages 15-44 years) in a state's general population. These factors, like family caps, serve to adjust the cost of bearing a child relative to the costs of contraception use and the use of abortions.