Nationally representative, longitudinal survey data from the Panel Study of Income Dynamics were used to examine the conditions under which welfare benefit levels affected the likelihood that low-income women age 15-24 bore their first child prior to marriage. Benefit levels had a positive effect on premarital childbearing during the 1980s and early 1990s but not during the 1970s or late 1960s. The effect of benefit levels was also stronger where community attitudes toward premarital sex were more tolerant than where attitudes were less tolerant, but this did not account for the varying effect of benefit levels over time. The study introduces a new way of measuring normative climate using attitudinal data from the General Social Surveys. Key Words: AFDC, nonmarital childbearing, normative climate, premarital childbearing, social norms, welfare benefit levels. The Social Security Act of 1935 created Aid to Dependent Children to help states provide cash assistance to needy children in single-parent families. Later renamed Aid to Families with Dependent Children (AFDC), the program provided an entitlement to cash assistance until 1996, when it was replaced with the Temporary Assistance to Needy Families (TANF) in the form of block grants to the states. During the early decades of the AFDC program, the primary beneficiaries were children whose fathers had died, but as the years went by, the children's mothers were increasingly divorced, separated, or had never married. The AFDC program was successful in raising incomes among poor single-parent families (Butler 1996; Danziger, Haveman, & Plotnick, 1981), but has been accused of encouraging divorce, separation, and nonmarital childbearing among low-income women. Despite a public perception that AFDC encourages low-income women to bear a child outside of marriage, three decades of research on the relationship between the AFDC guarantee (i.e., welfare benefit levels) and nonmarital childbearing have not established this relationship conclusively. Studies have found positive effects, negative effects, and no effect of the AFDC guarantee on nonmarital childbearing (see Moffitt, 1998, for a review). One reason for the contradictory research findings may be that real differences exist in the effect of benefit levels on childbearing over time and across cultural settings. It is likely that historical period and cultural context shape people's responses to public policy. Thus, it follows that the effect of welfare benefit levels on premarital childbearing, if such an effect exists, would vary over time and place. The current study focuses on women age 15 to 24 from the Panel Study of Income Dynamics. It examines whether the effect of welfare benefit levels on premarital childbearing changed over the period from 1968 to 1994, and whether the effect of benefit levels was stronger in communities that expressed greater tolerance of premarital sex than in communities that expressed less tolerance of premarital sex. This research develops a new measure of normative climate using data from the 1972-1998 General Social Surveys to accomplish this task. The following section summarizes the theoretical basis for the study. Previous research on studies of welfare effects and normative climate is reviewed and some related methodological issues are discussed. THEORETICAL FRAMEWORK A premarital birth is the consequence of a series of decisions made by an unmarried woman: whether to engage in sexual intercourse, whether to use contraception consistently, whether to abort a pregnancy, and whether to marry before the birth of the child. Women may not have a choice at each decision point-for example, if the sexual intercourse is coerced, effective contraception and abortion are unavailable, or potential partners are unwilling to marry. But in many cases, women are able to make choices and the amount of assistance available from welfare may affect their decisions. …