comparable with the poverty figures using the revised weights.

Table 1 shows descriptive statistics for selected economic and demographic variables, disaggregated by urban and rural areas. Our main variables of interest are total per capita income,<sup>2</sup> labor income, and poverty status. Total income and labor income are initially measured as individual income, with a reference period of the ’past month’, which is then aggregated to monthly income at the household level and finally divided by household size to obtain per capita income values. We convert monthly per capita income as well as the poverty lines (absolute and extreme) measured in local currency, Guaraní (PGY), into per capita income in 2017 US Dollars (PPP). Further, we spatially deflate incomes by the factor 0.897 for urban households to account for differences in price and income levels between urban and rural areas (Dirreción General de Estadística, Encuestas y Censos, 2012). Following from this, poverty is estimated by comparing monthly per capita incomes to the national poverty lines, separately for urban and rural areas. On average, over the period of 16 years, per capita labor income represented 75% of total income in urban, and 78% in rural areas. Moreover, a median income and labor income of $372.5 and $282.9 in urban and rural areas, respectively, which are considerably lower than the mean, points towards a skewed income distribution in Paraguay.

**Temperature and precipitation data.** The lowest level of geographical aggregation in the EPH is the district-level, representing the smallest political-administrative constituencies in Paraguay (Instituto Nacional de Estadística, n.d.). In total, there are 263 districts in Paraguay, including the capital city Asunción with population sizes from as low as 717 inhabitants in San Carlos, Concepción, to approximately 243,800 inhabitants in Ciudad del Este, Alto Paraná and 530,5000 in Asunción in 2023<sup>3</sup> (de Catastro, 2022). However, not all 263 districts are sampled for the EPH in every year. Based on all available districts in a given year, we match household survey data from the EPH with weather data. We use data on average and maximum daily temperature from the ERA5 Land Aggregates provided by the European Centre for MediumRange Weather Forecasts (ECMWF) and Copernicus Climate Change Service (Muñoz Sabater, 2019; Service, 2017). ERA5 data are available from 1950 to three months from real-time, and have a spatial resolution of 0.1° (approximately 9km _×_ 9km grid spacing). For precipitation data, we use daily rainfall data from the Climate Hazards Group InfraRed Precipitation with Station (CHIRPS) global rainfall data set, which are available from 1981 and have a spatial

> 2Total income is composed of labor income, rental income, income from interest and dividends, income from divorce benefits or child care, income from family assistance (remittances) from both within Paraguay and abroad, income from pension, income from social assistance programs (e.g., Tekoporã), social pension (the program Adulto Mayor), and other miscellaneous incomes. In 2019, labor incomes made up 85.6% of total incomes, on average (INE, 2020).

> 3The average population size per district in 2003 was 22,334 including Asunción, and 20,293 excluding Asunción.

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