How and why the incomes of others can shape the supply of overtime work

This paper shows how the allocation of an individual's time between overtime work and leisure is affected by comparisons with the incomes of others. It is shown that when the individual's utility function incorporates a measure of relative deprivation, the individual's optimal duration of overtime work is longer for any positive level of relative deprivation. Given the wage rate per hour, the individual reacts to an increase in his relative deprivation by increasing his overtime work.