There is no definite answer to that. It remains to be seen what is your niche and marketplace.
Secondly what sort of user generated content are you expecting? Are they in the form of comments, articles, reviews or testimonials? Surely there must be some existing content on your website which would encourage some traffic from the search engines and the social media consequenting in people posting some stuff on your site. Then it comes down to whether your visitors would find the stuff interesting enough to input their thoughts or not? On average, 5-10 out of 100 visitors take pains to comment on your post or a piece of content if it is written that good.
The question is not about handling the flags, as in the beginning you get loads of spam and you can easily rid of them using a good plugin software. It is about your objective and the future aim for your website. If you want to make a public wiki for any niche, the situation is different. If you want to post something on your own and allow the users to review it, the situation is different again. The major thing is to create some quality content, do some onsite and offsite SEO, and when numbers start pouring in, you can come up with some scheme about user generated content and handle that with changing time and situation.
User generated content is a very beneficial thing and is changing SEO significantly. I suggest you read some good material on how you can make users do SEO for you.