Oh most definitely. Even generals with only battle traits will boost city income when they have high piety. Of course, taxman/trader/intelligent traits go even further, but I'm quite confident piety has an effect as well.
I'll admit, I haven't watched closely enough to tell you how/why, or if it only cuts down on corruption and so on, though. No hard testing on my part, just repeated empirical results to "tests" as highly scientific as "Hmmm, what if I put that guy there ? Income up ? You, stay there. Read a book or something. But no mistresses !"
Which is why I'm a bit miffed that mere hyperactive spying will turn your king into a cruel madman stringing peasants up for kicks and giggles... Can't you stomp on people's privacy in a proper, caring judeo-christian way, dammit ?!
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