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There are two kinds of lugging.
One is when you get the engine under 1,600 RPM when you are in 2nd-6th gear. You can hear and feel it as harmful to the engine.
The second is when you put a significant load on the engine, either a hill or rapid acceleration when the rev's are between 1,600 and 2,000.
The first condition is bad all the time.
However, it does not harm the engine to operate in the 1,600-2,000 rev range as long as there is no significant load. At moderate highway speeds on level or declining terrain it only takes a few horsepower to keep the car moving so keeping the revs high is just a waste of gas under most conditions. That's why most modern automatics have an overdrive function that runs the car at low rpms when there is light load on the engine. With a manual, just be sure to downshift when approaching a hill or before you accelerate rapidly.
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