Varisia, despite Ileosa's claims to the contrary, is not a backwater - rather, it's civilization's very frontier. That frontier hasn't exactly been expanding at a rapid clip, of late, but Cressida's always held the conviction that Varisia will in time be tamed. That's just the march of progress.
Most Korvosans don't live in Korvosa the city. There are about 200,000 Korvosans in Varisia, not counting Magnimar and its holdings, which she at their insistence will not.
(...Okay, Cressida Kroft totally counts Magnimar and its holdings. And even if she didn't she'd still count Ilsurian, to do otherwise is just silliness. No, Magnimar can't have everything north of Lake Syrantula, that's stupid. But... she'll circle back to rescuing the people under odious Magnimar's dubious protection after she figures out what she's doing for the People and State she works for.)
Varisia is very much a frontier, though. You can think of Chellish Varisia as a set of concentric semicircles - layered, like a cake or a parfait.
The first layer is composed of the great markets and industrial centers of the coast: Korvosa itself, where the Jeggare River feeds into Conquerer's Bay, Veldraine, 45 miles across the bay, and smog-choked Palin's Cove, 50 miles up the coast from Veldraine at the mouth of the Falcon River.
Everyone must eat. The coastal towns and cities, with their collective tens of thousands, create a tremendous demand for produce. That demand, as much as any god or other power, defines the lives of every man and woman and child in Varisia.
The second layer is high-density food production.
Near enough to the great markets to sell things which are hard to make at scale and which spoil quickly; here you see vegetables grown, and fruit, and dairy cows kept on small lots. This second layer is a relatively thin film that hugs the coast, but it isn't evenly spread; it radiates from the sea in fractal spokes, clinging to roads and especially the rivers. Distance is measured in hours, not in miles; the time it takes to reach the market by foot or cart or ship is much more important than mere spatial proximity.
The third layer is hinterland.
In most parts of Golarion, peasants cluster in villages. Farmers are concerned foremost with resilience; they farm multiple small plots spread across different microclimates to protect themselves against erratic weather, they defend each other from monsters (23 1st-level commoners makes for a CR 7 encounter, and not every peasant farmer is a 1st-level commoner: villagers can handle themselves), they rely on lateral relationships with other farmers to survive disaster, giving charity and receiving it in turn...
And what they grow, they eat.
You are unlikely to get rich through peasant farming, that's really not how it works. Peasants are hard-working by necessity, but they aren't any harder working than is useful.
That'd just see taxes raised on them.
Absent punishing taxes, less than 10% of Golarion's produce finds its way to coastal market cities.
(This description of Golarion isn't as descriptive of Varisia; Varisia is a frontier, and that brings with it social mobility, and large homesteads that haven't yet been divided by generations of inheritance, and diligence that is rewarded. It's still pretty descriptive of Varisia.)
The hinterland covers the fertile ground between the Yondabakari and Sarwin River, between the Sarwin and Falcon, between the Falcon and Jeggare. It stretches further up the rivers towards their sources, since distance is counted by the hour and grain-laden barges float downstream, and to the roads.
The fourth layer is marginal land used for ranching. Animals need a lot of space, and can walk themselves to the market.
The fifth layer is true wilderness, with its hunters and trappers and prospectors and iconoclasts.