The are too many penalities for large empire/ lots of cities, even if the cities cover a similar area, but are just close together; Increased Maintenance, Lower Stability, Higher research costs, Worse AI trade deals, More defenders neaded, Higher Vulnarability to the plague(as units are spread out).
This stops me building more cities closer together.
E.g. if I am playing in the middle east I never build any cities in Arabia and only keep mecca (except I am forced to have Sana'a as Arabia), I build a fort instead of a city for my Suez canal, I never build Basra, Try to destroy Alexandretta, etc...