[kbenson]

Because "residents" is a group defined by perspective. If the residents in a city don't want something, but the residents of a neighborhood do, which has authority? What about residents of a city compared to a state?

How does this idea interact when the things being decided include whether other people can become members of the deciding group? If a neighborhood has authority over themselves, and votes for no new housing and no sales (bear with me for the thought experiment), have they then effectively locked that land down from the rest of the public that might want to live there?

What about when it's restricting things based kn race or income class? It's just the extreme of the above, so allowing a community to control the area absolutely would definitely lead to situations like that in the absence of larger jurisdictions with laws that override the local ones.