It depends on the government you are in - allowed units basically means "free units" - you don't have to pay maintenenace for them.
Each government has so many free units, plus so many extra for each town, for each city and for each metropolis.
Despotism: 1 gold per unit, but get 4 'free' ones per town/city/metro.
Monarchy: 1 gold / unit, 2/4/8 free per town/city/metro.
communism: 1/unit, 6/6/6 per t/c/m
republic: 2/unit, 1/3/4 per t/c/m (Note: In Civ3 & PTW this is different - these are C3C numbers!)
Democracy: 1/unit no free units.
fascism: 1/unit, 4/7/10.
Fedualism: 3/unit, 5/2/1 free units.