Elemental Forums
How do I connect towns wtih Caravans?
And is the only way to expand my area of influence by addings buidlings and huts?
Flame Away! 
Build a caravan and send it to another town by clicking the right mouse button.
Think they gain influence over time, but with increased speed by some buildings? Not entirely sure.
Just build a caravan, and move it to another town. Once it reaches the town it'll create a route (and a road).
The cities' zone of influence expands when they level up, and I think a bit from Prestige. Since it is "x tiles from city border", you can inch it to a resource or something by expanding the city in that direction.
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