One of the reasons private crop insurance markets have not developed is the relatively low demand for crop insurance. Despite large subsidies in the United States, crop insurance participation historically has been relatively low. Farmers and ranchers use a variety of risk management strategies to mitigate the risks they face (Harwood, Heifner, Coble, Perry, and Somwaru, 1999; . GAO, 1999), many of which compete with crop insurance. These include futures and options markets, contracting, cultural practices that reduce crop loss (., irrigation, pesticide use), crop and livestock diversification, nonfarm income, savings and borrowing, leasing, federal price and income support programs, and federal disaster assistance payments. A number of studies have estimated the demand for crop insurance (for a.