With the standard non-linear income taxation framework with heterogeneity o
f preferences, in this paper the optimality of workfare as a screening tool
is examined. It is assumed that workfare does not serve as a human capital
investment, participation is mandatory, and administrative costs are negli
gible. Imposing alternative cardinalizations on individuals utilities allow
s for the possibility that the government optimally redistributes income to
or from high disutility of labour individuals. Under either case, it is ne
ver optimal to impose workfare on these individuals. It is also shown that
non-productive workfare can be an efficient policy tool, in contrast to the
results found in Besley and Coate (1995), Brett (1998), and Beaudry and Bl
ackorby (1997). JEL Classification: H21, H23.