Climate change and community well-being: A four-decade analysis of rural consumption in India

Climate change poses serious threats to rural welfare, particularly in agrarian economies like India, yet limited evidence exists on its long-term, subnational impacts. This study addresses that gap by examining how climatic variability, rising temperature, and fluctuating precipitation affect household consumption using district-level panel data spanning four decades across rural India. Employing a fixed-effects regression model, the analysis reveals that a 1°C increase in temperature leads to a 4.6% decline in consumption expenditure, while precipitation has a modest positive effect. The adverse effects are more severe in historically hotter and structurally disadvantaged districts lacking adequate infrastructure, financial access, and energy connectivity. Conversely, better-developed regions exhibit greater resilience. These findings highlight how climate exposure interacts with socioeconomic and infrastructural deficits to shape vulnerability. The study underscores the need for targeted adaptation policies and structural investments to build climate resilience and support sustainable development goals related to poverty and inequality reduction.