A higher dilution contains less of the developing agents and will exhaust faster. ; i.e., fewer prints per liter. If you only develop a few prints and then toss otherwise good developer at the end of the session, then a higher dilution may be more economical. Side effect: development time may be extended with higher dilutions.
At some point, a solution will become too diluted to work effectively; the concentration of developing agents isn't great enough to initiate and sustain development. Most developers need an alkaline environment to work well and extreme dilution will change the pH toward neutral at some point, even with buffered developers.
Before complete failure due to extreme dilution, areas of greater density will suffer due to lack of development (the theory behind many compensating developers).
How far you can go with dilution depends on your patience and the results you require.
Doremus