Steer · Captive demand
Voluntary war-bond drives and patriotic savings campaigns (moral suasion)
- What it is
- State-organised mass campaigns, workplace savings groups and payroll deductions that channel small savers into non-marketable government savings bonds or certificates, using patriotic pressure, volunteer networks and employer cooperation rather than market yields.
- Why it counts
- Social and workplace pressure plus convenience mobilise household savings into fixed-rate government paper during high-deficit periods, often at rates that wartime inflation later erodes.
When it was in force
- United Kingdom: 1916 → 1978, historical
- United States: 1941 → 1945, historical
- Canada: 1940 → 1945, historical; its end is not documented
3 examples
United Kingdom
1916 → 1978HistoricalAs cited: 1916-1978 (National War Savings Committee 1916-1919; National Savings Committee 1919-1978)
The National War Savings Committee organised local voluntary savings associations and sold war savings certificates; its successor ran some 1,300 local committees promoting savings groups until 1978.
United Kingdom today: index 44.4Treasury minute of 8 February 1916 establishing the war savings committees; war savings certificates (later national savings certificates)Primary source
“In January 1916 the committee advocated the organisation of local voluntary savings associations and the introduction of 'war savings deposits', later designated 'war savings certificates'”
United States
1941 → 1945HistoricalAs cited: 1941-1945 (Defense Bond 1941, War Bond 1942-45)
The Treasury launched the Series E bond on 1 May 1941 with a national volunteer programme enlisting financial institutions, business executives, media and entertainers to promote it, citing heavy defence spending, a fast-growing debt and the growing threat of inflation; sales were voluntary.
United States today: index 42.9Series E Defense/War Savings Bonds and the Treasury's national volunteer sales programme (with the Payroll Savings Plan)Primary source
“On May 1, 1941, the Series E bond was introduced, and with it the start of a national volunteer program.”
Canada
1940 → 1945HistoricalIts end is not documented · As cited: Second World War (11 Victory Loan campaigns from 1940; war loans since 1915)
The Dominion Government ran 11 Victory bond campaigns in the Second World War, raising $11.8 billion, with stunts such as Winnipeg's 1942 'If Day' mock invasion.
Canada today: index 31.3Victory Loan campaigns run by the National War Savings Committee and, after 1942, the National War Finance CommitteeSecondary source
“the Dominion Government carried out 11 campaigns for its Victory bonds during the Second World War. Nationwide initiatives began in 1940, managed by the National War Savings Committee.”
Examples and their dates reviewed .
More captive demand
Further reading
- The Coming Great Repression? New Measures and a Century of Evidence
- The Sovereign-Bank Nexus in Emerging Markets and Developing Economies: Trends, Determinants, and Macrofinancial Implications
- Financial engineering is no substitute for interest rates: Lessons from Türkiye
- ‘Muddling through or tunnelling through?’ UK monetary and fiscal exceptionalism and the Great Inflation
12 more on captive demand
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- Financial Repression and Exchange Rate Management in Developing Countries: Theory and Empirical Evidence for India