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While competition adds to the incentives for producers to build and price particular items efficiently, the issue is whether those efficiencies would be greater or less than the inefficiencies created by the duplication of infrastructure implied in the competitive road market you apparently envision. In regards to the notion that the threat of entry would keep private road operators in check, this does not seem particular likely. Roads have extremely high up front costs and long lead times. It is difficult to envision the owner of, say, the Hume Highway between Goulburn and Yass, or the Armidale-to-Tamworth road, losing too much sleep (or changing its pricing/quality choice) at the prospect of awaking one morning to find a new road competing for its custom. That said, there is potentially more scope for competition between different trunk routes within a city, or will be as tolling technology develops. None of this, incidentally, is based on "ignorance" of the imperfections of State-owned roads. One could well make the judgement that privately-owned and monopolised roads are better than government-owned and monopolised roads. However, this judgment is largely separate to the issue of merits of competition between road owners.
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