Could be good, but Population doesn't grow no matter how much food you're making per round, gold is impossible to maintain in the long run due to no population growth for taxes. Then if your mercs die, it's impossible to replace them without the gold, so it's just game over. Also several times, i'd get item drops from battles, but would never get the chance to loot them.
Having the merchant with almost no gold to buy your wares is also really bad. I sell 5 wood then he's broke forever.
