The principal contradiction facing Chinese society in the new era has evolved into one between the people’s ever-growing needs for a better life and the inadequate and unbalanced development. This means that in the current stage, the process of realizing common prosperity in China is about enabling the public to comprehensively share diverse public goods. Based on the panel data in 31 provincial regions of China, this paper empirically analyzes the impact of social livelihood public goods on variables such as the public demand gap and the proportion of general public expenditure. According to the empirical results and the characteristics of livelihood public good?s, such goods are divided into two types: public goods that do not expand the public demand gap and those that do. The former is characterized by a rough balance between the government’s budgetary expenditure and fiscal revenue allocated to these public goods, yet it will drive up the government’s general public expenditure, such as pension and social assistance. The latter is distinguished by government budgetary expenditure for these public goods exceeding fiscal revenue, while it exerts no upward pressure on general public expenditure, such as resources and environment as well as medical and health services. The relationship between these two and general public expenditure reveals that the former demonstrates stronger public goods attributes.Based on an analysis of the suppliers of these two types of public goods and their interrelations, and taking the supply of public goods such as medical and health services during the COVID-19 pandemic prevention and control as a case, this paper proposes that the former may be primarily provided by third-sector entities, while the latter should be mainly supplied by market enterprises. This paper classifies livelihood public goods into two major types according to empirical results, which provides beneficial enlightenment for the proper selection of public goods supply subjects. The classification would be helpful to choose the appropriate public goods supply mode, improve supply efficiency, and promote the realization of common prosperity. For livelihood public goods, how the market or third-sector entities can effectively participate in their supply requires government departments to provide efficient guidance by means of public expenditure and other tools. It also requires the government to leverage robust administrative measures to effectively enhance the coordination among the three parties, thus establishing a cooperative mixed supply model involving the government, the market, and third-sector entities. This will ultimately address the demand for livelihood public goods and steadily advance the achievement of common prosperity. The government should grant sufficient fiscal and administrative powers to third-sector entities engaged in public goods provision to support their development, and set clear standards and norms for public goods supplied by market enterprises.