Climate-Induced Agrarian Risk and Livelihood Vulnerability: A PLS-SEM Analysis of Small and Medium Farmers in Semi-Arid India

Abstract

This study analyses the impact of climate-induced agrarian risk on livelihood vulnerability among small and medium farmers in the semi-arid region of West Rayalaseema, India. The study is based on primary data collected from 300 respondents using a structured questionnaire. Partial Least Squares Structural Equation Modeling (PLS-SEM) was employed to examine the relationships among climate risk, agrarian risk, marketing constraints, financial constraints, and livelihood vulnerability. The findings reveal that climate risk significantly influences agrarian risk (β = 0.65), which further impacts marketing constraints (β = 0.58) and financial constraints (β = 0.62). Among these, financial constraints have the strongest effect on livelihood vulnerability (β = 0.53), followed by marketing constraints (β = 0.41). The study also confirms the mediating role of agrarian risk in transmitting climate effects into economic vulnerability. The results highlight the importance of financial inclusion, market reforms, and climate-resilient strategies in reducing farmer vulnerability. The study contributes to the existing literature by integrating environmental and economic risk factors using an advanced SEM approach.