Holy Roman Headache!

[Matty]

yes. They'll stop the mercs getting through to the recruiting grounds of the inns. Considered 'undesirables' all these unemployed ruffians hanging around...

[EatYerGreens]

There's nothing in the Build_Prod files to support that, but it would be a doddle to mod the game to attach a repulsion effect on Border forts, to simulate the effect you describe.

There is an entire data column for "is this a shady place where you might hire mercenaries?" but the Inn is the only building in the default version of the game where there's an entry of any kind.

Strangely, there is no populaiton happiness adjuster for the Inn and it makes you wonder why the AI factions build them all over the place then (apparently) never atually hire any mercs.