> Any empty domain starts with the same reputation
What basis would you have to do otherwise, and if there is something (like TLD), why wouldn't "resetting to zero" in terms of past content just mean resetting to that zero?
> Registering a new domain is a 0 cost action
No, that registering a new domain has a similar cost to renewing an existing domain, which is a valid assumption. In fact, the new domains are often cheaper because registrars often discount the initial registration as a loss leader with the expectation that people will make future renewals at a higher price.
> The eng effort to reset domain reputation is 0
It is the job of the party operating that system to make it operate as correctly as feasible. Needlessly causing collateral damage purely out of laziness and unaccountability is how you get people showing up at government offices demanding for you to be regulated or broken up, if not showing up at your offices with a disposition to cause bodily harm.
> Certain domains are used by abusers more often, usually due to them being cheaper.
Running out of domain names is physically impossible. There are more possible domain names in any given TLD than there are atoms in the observable universe. So the low price is going to be the price set by the registry for that TLD.
Whether the TLD itself has some reputation is orthogonal to the reputation of one domain in that TLD relative to another one in the same TLD. Moreover, you would presumably do the same thing for the TLD -- if one TLD is doing promotion and has $1 registrations this year and then gets used for a lot of scams, and then next year it costs $15 and so do the renewals so the scammers move to a different TLD, the reputation of the TLD should be reset just the same as the individual domains.
> Even if the new system was marginally better, it could be a large eng effort and not worth pursuing.
If the primary goal is to reduce engineering effort then the obvious solution is to delete the entire reputation system so it doesn't have to be maintained anymore. If the primary goal is to make it work well then you have to, well, you know.