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Whenever I play as Realms with high Dev. counties and then revert back to some of my other games with low Dev. counties, the difference is night and day. I make tons of money and have a large and rapidly growing pool of Levies. By contrast, when I play as Realms with low Dev. my Levy pool barely grows and my Income inches upward, despite the fact that I keep growing my Realm size very often.
If your Vassals increase development, so to will their pool of taxable income, which will by definition increase the amount of tax that you make off that amount, so your income off your Vassals, will still increase.
Based upon the line of reasoning that says 'Development does not matter', there would little to no difference in income between these two counties. Yet, in reality that does not happen. Both the amount of gold and levies that you would make off the Dev. 100 County would be MASSIVELY more than the County with a Dev. rating of 0.
Building things doesn't add development as far as I'm aware, and both income and levies aren't actually that closely linked to development. As an extreme example, Constantinople gets something like 15 gold monthly at base income and the absolute highest development would add +50% for 22 gold. I think some of the gold mines can get higher but that also means waiting longer, because the starting point is even lower. As long as you're getting tech fast enough you really just don't need to worry about development.
To take a real-life example, a place like Hong Kong or Singapore would have a very high Development rating.
A place like the Sahara Desert or the Australian Outback would have a Development rating of 0.
If your Realm controlled any of the two of these areas, guess which one would make more money?
You don't get building slots with development.