It makes it so that characters like a mathematitian philosopher and people of that ilk are added to your governors retinue. At higher levels the academy buildings increase the chance of a famous historical scholar like Archamedes getting stuck in a family members retinue.
EDIT I also think that it precludes characters like the drunken uncle and drinking buddy from showing up in the retinue, characters that the barbarian tarven increase the chances of showing up.
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