This is complex, mainly because Paradox divorced income completely from research. Tall did better in the sense that it encouraged the emergence of a middle class, which in turn ended up being a winning asset in the last part of the timeframe (in production, trade and innovation).
Actually the biggest problem is that it's precisely the inverse of this. Spending your MP on development
slows your acquisition of technology and innovation (ideas), and it does so at a rate that is
several times worse than conquest even with the current increases to coring and diplo-annexing.
One of the best changes EU4 could make is to eliminate the use of MP to acquire tech. I'd recommend a new set of resources like MP that can only be used on technology and ideas, and the amount of those you gain depends on your average development levels, autonomy, and intolerance. This means nations that rule over primarily accepted cultures and faiths, then develop those provinces, will get tech and ideas much faster than nations that expand instead, as those provinces with intolerance and high LA won't contribute many points. This will also help nations in places like Asia who struggle to afford either expansion
or development because of the high cost of tech.
With a mechanic like that in place, coring could be changed to require all three types of MP in amounts that depend on the three development levels of a given province. Diplo-annexing is an issue but the time requirement (+ eating the diplomat) is the most important component of that mechanism anyway.
Many of the mechanisms that currently improve MP could then be modified to improve the tech/idea resources instead. PP would probably still give MP, but advisors would be better for tech/idea points (so that expanding nations that take lots of cash can use this method to keep up; thinking of Russia and Spain here). Might even be worth considering another super-expensive tier of +4 advisors.
Alternatively, you could get tech/idea point bonuses for dominating lots of trade nodes; that increased exchange of goods and ideas makes a lot of sense for this and provides an expansive alternative to internal development.