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Have you played Total War a lot? The AI has enormous bonuses to it's economy. At all difficulties. So this mod is actually just letting you even the playing field, if you know how to make money, of course. The AI is going to be economically better than you even if they own 1 settlement, otherwise they wouldn't be able to constantly spam units comparable to the player. It's the only way the devs could create a slightly challenging AI, if the AI couldn't cheat, the game wouldn't be much war, more like, total capture settlement.