It doesn't make sense that by pillaging another nation, somehow your own lands immediately become more built up. It would make more sense contextually if the settlements raided provided the nation pillaging with greater knowledge of certain technologies, and so the ability to tech up more quickly, perhaps suggesting that a temporary reduction in tech cost would be a more fitting benefit of pillaging, alongside immediate monetary gain?
What do you think happened during most of the Eastern European raids? That the skilled craftsmen were left when the slavers went by?
Likewise, if my raiders make off with all your oxen, why wouldn't some of my farmland become more productive with more manure and animal power for ploughing while yours became weaker? Iron implements, books, and even whole structures were carried off on a regular basis. Stealing capital goods (including in this era enslavement) was a major way to acquire physical and human capital which did lead to massive increases in the goods production, manpower, and tax revenues of the raiders. We can see this quite well by looking at what happened in border raiding areas once the raiding stopped. The Scottish border, for instance, went into decline once the raiders there could no longer plunder England. Crimea was built almost entirely on raiding and stopping the Tatar raids was one of the biggest things that allowed for development of Southern Russia. Horde cities routinely fell in productivity and economy when their patrons moved the border too far from them to support a raiding economy. The Barbary pirates managed to build a large base of economy off piracy.
Frankly, if we were being realistic, major wars should result in major development burns. There would be some gains to the aggressor (the carried off loot and people), but also gains to states to which war refugees would flee.
Development =/= better production. That's represented by technology and production efficiency. Development represents the manpower necessary to create either finished goods (production), armies (manpower), or tax base (base tax). One could say it also represents the land's ability to support industry, but that can't exactly be transferred via raiding, can it? Pillaging of materiel would be represented by either a tech discount, development discount, or at its most basic level extra monarch points, which is already implemented in-game via the power projection system and the Native American Humiliation CB. Besides, looting of enemy materiel is already represented by demanding gold in war goals and the looting mechanic. That gold can be invested into development indirectly through advisers or buildings, and the enemy does not have that gold with which to develop themselves. To make a permanent change in development instead of a temporary modifier like Looted, something big must have happened, like a population change/exchange. Getting lots of plows might be useful in the long run for research, but without a skilled production base, how is that going to increase development?
Pretty much the way it happened every time it ever happened in history, by allowing economic and population growth. I get a one-off gift of $1,000,000 odds in 5 years that the difference between me and a me-without-the-gift will only be $1,000,000? 0. Because I'm not just going to sit on the goods. I will use it to grow the nest egg. Similarly, stealing the oxen will not just be a one off now, but it will allow for more fields to be put to the plow, which means more food for the village, which means lower infant mortality, which means higher population. Given the nature of food production in the era, getting another 20 or so farmers means that the village economy supports another artisan. This artisan in turn provides additional benefits to society.
This also works in the reverse on the looted province. Losing the plow doesn't just mean you have less food now, it means that you can till fewer acres and thus will be more likely to have population loss during the winter (particularly if it is bad and the looting wrecked the crops). This in turn means that you lose artisans, which often meant that capital improvements, like canals, quarries, or lumbermills, can no longer be supported because the local price of food has risen too high to make these specialized labors profitable (and this is an era in which food prices are VERY local).
The economy of the EUIV era largely boils down to just three components:
1. Who is getting high value on trade from very disparate goods exchanges - what we call trade.
2. How much grain is being grown and how many peasants/animals live off of it.
3. How much bullion is being mined.
#2 was by far the most important for most states in the era. (#1 was an issue for places like England, the Netherlands, Venice, etc. while #3 was only an issue for a few places like Serbia, Spain, and the like).
Development was virtually never about new technology historically, it was almost always about having enough food to support specialized workers to build and maintain infrastructure.
Anything that increased food supply would ultimately increase the number of workers would could then go build and maintain capital improvements.
