Historically, both have occurred. With the Industrial Revolution improvements began in each state as private enterprises in particular with railroads. This initiative mean the tax payers did not have to be responsible in helping one person obtain wealth which would not be returned to the tax payer. However, as infrastructure needs to cross state lines, the government is a better negotiator and it makes more sense to have a federal overseer taking care of state-to-state initiatives, like the Highway Act. Ideally, if the government is investing, there is an effort to make it for the greater good and all will benefit from the investment. This also ensures that a needed infrastructure project does not exploit the citizens who must utilize the service. Right now Internet lines are the debated need. Private industries currently run lines and charge a lot for what is becoming (or already become) an essentially need for day-to-day life.
