Abstract: Common prosperity is an important feature of Chinese path to modernization. Based on the data of China Household Finance Survey (CHFS) from 2015 to 2019, this paper uses the Cov-AHP method to build inclusive finance index and common prosperity index, and discusses the impact of inclusive finance development on common prosperity by examining the correlation between inclusive finance and common prosperity dimensions. The research shows that: (1) At present, the overall level of common prosperity in China is not high, and the level of common prosperity in most regions is concentrated. And the study found that there are "rich but not common" or "common but not rich" situations in regions with higher levels of common prosperity, and few regions can achieve a balanced development of richness, sharing, commonality and sustainability; (2) The development of inclusive finance can promote the overall level of regional common prosperity, but the multi-dimensional test shows that this role is only reflected in richness and sharing, and has no obvious effect on commonality and sustainable development; (3) The heterogeneity test shows that inclusive finance plays a stronger role in regions with medium and lower levels of common prosperity, eastern and central regions. The development of urban inclusive finance is more conducive to improving regional richness, and the development of rural inclusive finance is more conducive to improving regional sharing; (4) The threshold regression model shows that there is a threshold value of inclusive finance development level to promote common prosperity in the northeast and western regions, and the role of inclusive finance is not significant below the threshold value. Therefore, formulating and implementing targeted inclusive financial policies and methods is an effective way for inclusive financial development to promote common prosperity.

Keywords: Inclusive Finance; Common Prosperity; Heterogeneity Research; Threshold Effect; Cov-AHP