Who Uses Interest Arbitration? The Case of British Columbia's Teachers, 1947–1981

Several researchers have attempted to identify the circumstances under which parties subject to compulsory interest arbitration will actually push a contract dispute to arbitration. In this paper, a simple model that incorporates elements of the leading hypotheses is tested using a unique data set spanning 35 years of compulsory conventional arbitration experience among teachers in British Columbia. The strongest empirical finding is that bargaining units that used arbitration in the previous round of negotiations were at least ten percent more likely than other units to use it in the current round. On the other hand, variables intended to capture attitudes toward risk, changes in the degree of uncertainty associated with arbitral outcomes, differing beliefs about likely arbitral outcomes, and principal-agent problems were found to have little impact on the estimated probability of using arbitration.