I presume the majority of that difference is because there's a healthy market for VPNs with practically no barrier to entry, whereas your ISP is a monopoly usually, or a duopoly if you're lucky.

Not outside the US. E.g., in our apartment, we can subscribe to fiber, cable, and DSL. On fiber and DSL, there are many ISPs to pick from. However, the prices are still similar to the US (you just get a lot more bandwidth for the same price).

I think it is more that the costs of running an ISP are much higher, you do not only need peering, but the networks including the last mile need to be put in the ground and maintained. Plus, in to some extend, people in areas with high-density populations subsidize expansion into lower-density areas.

The VPN market is really different. In principle anyone could start a VPN using just a VPS (it wouldn't be the best, but many VPNs are terrible anyway).

I'm pretty sure you and GP are saying the exact same thing.

Then it's not the same price.

I assume that the VPNs buy bulk bandwidth, and also they have to compete with each other, whereas the ISPs have to run (or lease) the actual lines to my home.

I don't know if there is a good place to draw the line... but free sure is in the "hey no reason to trust this in any way" zone for me.