Traffic engineers already know how to properly set speed limits ... provided that politics doesn't interfere.
Except in very limited circumstances where special hazards exist (i.e. school zones during school hours ... NOT the entire city all the time because there is a school somewhere in it that might have kids there at 2 AM), speed limits should be set to the 85th-percentile speed of natural traffic flow (speed limit signs temporarily removed and with no visible enforcement, not during inclement weather, not during rush hour congestion, not within a certain distance of an intersection, etc), and the enforcement limit should be set at the 90th-percentile.
People do not naturally drive X km/h above whatever speed limit. They go a speed that seems rational for the circumstances. In Germany on unrestricted sections of autobahn, people do not drive infinity plus 20 km/h. They, for the most part, drive in the 120 to 140 km/h range ... little different from here. The police enforce lane behaviour, signalling, proper lane changing, etc ... not speed. Sure, there is the occasional high-end Mercedes or BMW cruising at 180 km/h. For every one of those, there are at least 10 each of VW Golf non-turbo diesel, Ford Mondeo towing a trailer bigger than the car (restricted to 100 km/h with a trailer and strictly right lane only), Renault Twingo, and vans. Lots of vans. The european version of my van is a Fiat Ducato, and they have a 2.3 diesel. All of those other vehicles ... aren't fast. A Fiat Panda will happily cruise at 120 km/h, so that's what they do....