I was listening to the talk in the zone next door, and they lagged out completely. There were probably 50 people in that zone. In my zone, lag was slight or zero. I kept right on harvesting and crafting full speed, no problem, while listening to the zone next door complain and people were logging out. For a short period, we lagged also, but about 10 sec max. The next door zone was talking about 5-10 minutes!

My theory is that each zone has it's own list of entities, and as this list gets longer, the lag gets worse. A single player in a sparse zone might never see lag at all. A busy zone with a large tribe will see a lot of lag.