This controls the number of concurrent builds that Hudson can perform. So the value affects the overall system load Hudson may incur. A good value to start with would be the number of processors on your system.

Increasing this value beyond that would cause each build to take longer, but it could increase the overall throughput, because it allows CPU to build one project while another build is waiting for I/O.

When using Hudson in the master/slave mode, setting this value to 0 would prevent the master to do any build on its own.