The increasing frequency and severity of extreme weather events (including heatwaves, droughts, bush fires, tropical and extratropical cyclones, tornadoes, hailstorms, floods and storm surges) and the historically unprecedented economic losses observed in 2004/5 have intensified the ongoing international debate about the possible adverse impact of climate change on global weather patterns. However, the adverse implications of climate change are likely to vary considerably from one country to another based on geographical location, effectiveness of climate adaptation strategies, level of insurance penetration, and the overall resilience of the economy to exogenous shocks. While the complexity of these atmospheric phenomena makes it difficult to accurately predict the impact of climate change on a given country, it is clear that disaster-prone developing countries are likely to be affected most severely due to their weaker economic base and the very limited use of risk transfer instruments in these societies. Catastrophe risk transfer from disaster-prone countries to global reinsurance and capital markets represents one viable adaptation solution which has been gaining the support of international financial organizations. Article 4.8 of the United Nations Framework Convention on Climate Change (UNFCCC) and the supporting Article 3.14 of the Kyoto Protocol call upon developed countries to consider actions, including insurance, to meet the specific needs and concerns of developing countries in adapting to climate change. However, to date, there has been little understanding or agreement within the climate change community on the role that insurance-based mechanisms can play in assisting developing countries to adapt to climate change. Responding to this low level of awareness of the role that can be played by insurance-related mechanisms in countries' climate change adaptation strategies, a group of NGOs, reinsurers, climatechange and insurance experts from international financial organizations, and policy researchers from academic think-tanks decided to form the Munich Climate Insurance Initiative (MCII). Founded in 2005, the organization provides an open forum for examining insurance-related options that can assist with adaptation to the risks posed by climate change.

I'm very glad you've given up those rooms. ... We should give up still more." Dr. Zhivago, p. 170 The inadequacy of housing and its effect on the quality of life go a long way toward explaining many aspects of Russian life, but little data has been available to determine how housing affected the relative well-being of the citizenry. This paper presents comprehensive data examining for the first time the effect that seventy years of a socialist housing allocation scheme had on the distribution of income. It seems clear that housing provided by the government or by employers has a value that can be measured to yield useful inferences about the distribution of income and wealth. This article shows that housing allocation had a progressive effect on the distribution of income in Russia. In addition, when the imputed value of housing is added to household income, the increase in income inequality that occurred in recent years is significantly reduced. The analysis concludes with a discussion of how housing policy could be used to address poverty concerns, an important aspect of the transition process. O n his return home from World War I, Boris Pasternak's fictional character Dr. Zhivago finds that he has to share his family's Moscow mansion with workers and their families. Since at least that time Russians have been sensitive to the effects of housing on living situations. The housing shortage and the difficulties of living in cramped quarters have been a fundamental aspect of Russian life and writings about it. 1 Unfortunately, aside from figures on the number of square meters of housing space produced and surveys based on interviews with emigres, little statistical material has been available to determine how housing affected the well-being and social position of Russian

Mahul and Gurenko propose a financial model to address the design of efficient risk financing strategies against natural disasters at the country level. It is simple enough to shed analytical light on some of the key issues but flexible and realistic enough to provide some quantitative guidance on the ex ante financing of catastrophic losses. The risk financing problem is decomposed into two steps. First, the resource gap, defined as the difference between losses and available ex-post resources (e.g., post-disaster aid), is identified. It determines the losses to be financed by ex ante financial instruments (reserves, catastrophe insurance and contingent debt). Second, the cost-minimizing financial arrangements are derived from the marginal costs of the financial instruments. The model is solved through a series of graphical analyses that make this complex financial problem easier to apprehend. This model captures and explains the main impacts of financial parameters (e.g., insurance premium, cost of capital) on efficient risk financing structures.

Gurenko and Mahul examine how market-based risk financing instruments could enable asset-poor but productive farmers exposed to production shocks to engage in riskier but higher return agricultural activities. The financing of these exogenous shocks is addressed in a conceptual framework based on an optimal allocation of capital where the farm is viewed as a business unit. The approach allows for (i) testing the business viability of a specified crop by assessing the minimum business capital required to ensure the continuity of the business after the occurrence of an adverse production shock; and (ii) designing an optimal risk financing program to finance the minimum capital requirements using a combination of instruments (insurance, savings, and borrowing). The authors provide numerous numerical and graphical examples to illustrate the relevance of this financial approach to the specific issues of agricultural risk management.

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