Should one give to beggers?

I'm very fortunate to live in an affluent part of the world. Even so, it is a common site to see people begging for money in the street. In our town there are posters up asking people not to give to beggers as it just encourages people to beg more. However habitually walking past people begging does not feel like the compassionate thing to do. Is it possible to bring Buddhist ethics and philosophy to bear on this? Should one give to beggers in this circumstance? It would be good if answers could include textual references to illustrate the point however all answers gratefully received.