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Cf 7-/D 1 Comments and suggestions by Roy Black, Steve Hanson, and Jack Meyer are much appreciated. Acknowledgment is made to the Michigan Agricultural Experiment Station for its support of this research. CROP INSURANCE UNDER CATASTROPHIC RISK Some risks cannot be fully insured because of incomplete or costly coverage while others cannot be insured at all because of missing insurance markets. Incomplete insurance is usually explained by asymmetric information problems resulting in moral haz.ard and adverse selection (e.g., Chambers; Holmstrom; Raviv; Rothschild and Stiglitz; Rubinstein and Yaari). However, catastrophic risks (risks that are highly correlated across insureds) also play a role in reducing or eliminating insurance coverage in some markets. Indeed, the collective damage from natural disasters such as hurricanes, earthquakes, and widespread drought, often lead to large aggregate outlays by insurance finns, causing them to reduce participation or withdraw altogether from these markets (Borden and Sarkar). Thus, catastrophic risk can break down insurance markets by reducing o'r eliminating gains from trading risks, inducing insurance firms to seek large risk premiums, and/or by requiring insurance firms to hold especially large reserves in order to participate. One market in which catastrophic risk plays an important role is crop insurance where risks of crop failure are often highly correlated across commodities and regions. Because risks of crop failure are correlated, crop insurance finns cannot eliminate average risk by pooling a large number of farmers. This tends to leave crop insurance firms with considerable residual risk which must be dealt with either by establishing large reserves and/or by charging a risk premium to compensate for the probability of catastrophic loss (Cummins). While this issue of catastrophic risk has been discussed in the crop insurance literature, we are not aware of any published research which has analyzed the effects of catastrophic risk on the existence and nature of equilibrium in crop insurance markets. This is an important issue because the performance of crop insurance markets, and the success of Federal Crop Insurance Corporation (FCIC) policies designed to facilitate crop insurance coverage, depend critically on how insurance firms are responding to the presence of catastrophic risk. This paper focuses on catastrophic risk as a cause of incomplete crop insurance markets. We show ..__ that when the risks faced by different farmers are correlated then insurance firms cannot eliminate average risks

20Remote sensing derived wheat crop yield-climate models were developed to highlight the 21 impact of temperature variation during thermo-sensitive periods (anthesis and grain-filling;

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For a number of maritime tasks there is a short time period, typically only a few tens of seconds, where a critical event occurs that defines a limiting wave height for the whole operation. Examples are the recovery of fixed and rotary winged aircraft, cargo transfers, final pipe mating in fluid transfer operations, and launch/ recovery of small craft. The recovery of a 30-t rescue submersible onto a mother ship in the North Atlantic Treaty Organization (NATO) Submarine Rescue System is a prime example. In such applications short-term deterministic sea wave prediction (DSWP) can play a vital role in extending the sea states under which the system can be safely deployed. DSWP also has great potential in conducting experimental sea wave research at full scale. This report explores the feasibility of using data from an experimental wave profiling radar in achieving DSWP. The report includes theory, simulation, and field testing. Two forms of DSWP are employed: a fixed point system based upon a restricted set of wave directions from which some success is obtained and the other a fully two-dimensional technique that requires further development. The main finding is that using wave profiling radar for DSWP offers promise but requires improvements both to the spatial reliability and the resolution of the wave profiling radar and to the temporal resolution of its sweep before the technique can be considered to be viable as a usable tool.