Theoretical Connotation and Quantitative Measurement of Common Prosperity

Abstract It is of great importance to fully understand the connotation of and identify a quantitative method to measure common prosperity in China. This paper starts with a theoretical framework of fairness, efficiency, development, and shared prosperity, draws upon the proper understanding of common prosperity with Chinese characteristics, and explores a globally quantitative measurement of common prosperity, with a focus on the outcomes of national prosperity and prosperity for all. Furthermore, this paper discusses the assumptions and mathematical expressions of the quantitative function and analyzes the structural implications of indicator dimensions, functional relations, and variable standardization to ultimately provide a solid quantitative foundation for promoting common prosperity. The findings show that the quantitative measurement of common prosperity proposed in this paper performs stably in terms of weights, thresholds, and indicator settings. Based on the data of 162 economies collected between 1990 and 2020, this paper finds that China has made great progress in promoting common prosperity, which showcases the strengths of the country’s socialist system.