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You may have a workshop producing x item, but that item gets spread around the map by all those caravans. This eventually results in a lack of desire for that product. The irony is, the more a workshop produces the less demand there is for a product because those omniscient caravans instantly responds to changes.
When you add in the fact the more prosperous a town is the more it starves, it is comical.
TW has designed a system that kills itself.
According to this breakdown, certain workshops will close for a day because of their fractioned outputs.
Workshops amounting to any kind of profit cannot be considered useless. Or at least as useless as having another town or two?
High prosperity = more people. A town will plateau but prosperity is limited by food scarcity. It will only starve if the player artificially floats its prosperity.
Too many caravans amounts to oversupply and diminishing demand if trade routes are too safe. This also means much more taxes and growth and income. This is all still a good thing.
The only real serious issue for some time has been player understanding of a much more dynamic system.