ABSTRACT. This study estimates and discusses the effects of TANF cash benefits receipt on single parents’ (mothers’ and fathers’) labor supply, measured by employment status. The study uses a sample of 9,974 able single parents with dependent children (age ≤ 18) for 2007 from the March Supplement 2008 Current Population Survey. I conduct a logistic regression with employment status as the dependent variable and socio-demographic and state variables as independent variables. The main finding of the study is that TANF cash benefits receipt has a statistically significant impact on single parents’ employment probability. All other variables held constant at their mean, single parents receiving TANF cash benefits are less likely to be employed than single parents who do not receive TANF cash benefits—despite the work requirements and time limits that characterize TANF cash benefits receipt. Although there is strong evidence that welfare reform has succeeded in transitioning a significant proportion of single parents from welfare to work, my findings suggest that TANF cash benefits receipt does not necessarily imply that single parents join the labor market successfully. Assuming rational behavior, the study argues that single parents’ preferences for housework and childrearing are instrumental in determining their employment status and, therefore, that incentives to encourage their market work may fail to reach their goal. However, the study recognizes that a market-work focused welfare policy might improve the well-being of single parents and their families, although unsuccessful transitions from welfare to work may occur, as some previous research has shown. pp. 34–50
JEL Codes: I30; I31; I38

Keywords: welfare programs; labor supply; single parents; U.S.; public economics; public policy

How to cite: Dan, Sorin (2014), "Welfare and Work: How and How Much Do TANF Benefits Affect the Labor Supply of Single Parents?," Psychosociological Issues in Human Resource Management 2(1): 34–50.