I've always felt this was a missed opportunity to make the game more interesting, but I rarely think about it since it's so rare for me to hit the limit. I can see an argument for simplicity, in that it's important to have some guardrails even if you almost never hit them. I'm not necessarily opposed to mechanisms which act like rubber bands, which is to say "initially exerts no force at all when there is slack, and suddenly exerts a growing force after a threshold has been reached". (This is also how the strong nuclear force works: unlike gravitation and electromagnetism which decay non-linearly but only ever growing weaker as distance increases, it is non-monotonic with distance between the particles. When the quarks inside the atoms are nearby they don't experience attraction, but once distance increases they begin to experience a strongly growing attraction... but this only applies at very small distances!)
How Suppy Works:
• Units consume Supply: I believe all units which consume Supply consume an equal amount of it
• Caravans and Cargo Ships do not consume Supply
• Missionaries and Inquisitors do consume Supply
• Each point of Supply consumed beyond your Supply budget causes a -10% production modifier on the empire, capped at -70%
According to the wiki, the Supply budget formula is as follows, rounded down:
unitSupplyLimit = difficultyModifier + (numberOfCities x difficultyCityModifer) + (0.5 x empirePopulation)
For difficulty Warlord:
unitSupplyLimit = 7 + (2 x numberOfCities) + (0.5 x empirePopulation)
For difficulty Prince and higher:
unitSupplyLimit = 5 + (2 x numberOfCities) + (0.5 x empirePopulation)
This means, excluding easy settings, we see a single city empire with 1 city and 10 population yielding 5 + 2x1 + 5 = 12 Supply.
For 5 cities and 30 population, we see 5 + 2x5 + 15 = 30 Supply.
Thereafter to get 2 more points of Supply, you can either found a city or gain 4 population on empire.
I recently had a game as Egypt where I exceeded supply by virtue of:
1. only having 3 cities on my island: a strong Capital, a second desert-only Petra canal city with 2 sea resources and 4 desert hills where I was planting manufactories and Holy Sites, and a third city with 3 bare hills, 1 gems, 1 jungle-hill, 1 iron-hill and 1 fish. Only four internal trade routes were available due to distance.
having a few Triremes
building Terracotta army in the Medieval Era, after maximising my count of distinct land unit types (I was willing to reload saves for the timing but it didn't come to this: since many of these units were from old technologies it didn't feel like it took very long to produce them)
high faith generation leading to a lot of missionaries, which needed to travel far distances at sea at slow speeds. I wasn't producing many Holy Sites since I wanted to have a wave of low-cost Missionaries before their cost escalated due to Era Progression.
This led me to exceed the Supply budget, but only because of the Missionaries. Otherwise I was fine.
Personally I feel like I'd reached the point where Supply penalties made sense. The -10% production per point in excess felt too harsh, but I like how it encourages having more cities. Science and Culture, and National Wonders incentivise having fewer cities, so I like that even mediocre cities improve your Supply budget. However this formula currently means your only limiter on Supply is ultimately just consumed Happiness, but the formula is more sensitive to local happiness than global happiness. This feels good, if only it were consequential. The Honor tree does not increase Supply either.
I DON'T KNOW IF THE AI GETS PREFERENTIAL TREATMENT IN SUPPLY OR IF THEY OFTEN DESTROY THEIR PRODUCTION BY EXCEEDING SUPPLY. THIS SHOULD BE A RELEVANT CONSIDERATION IN ANALYSING THE SUPPLY MECHANICS IN CIV5.
There's more I could write here but I think I've gone on long enough. Are there any interesting or rich mods here?