Jay, I'm going to guess that you haven't been out in the "real world" much. And what I mean by that is you're probably young and still in school or recently graduated.
Your perception sounds like it's coming from someone who has been in an academic environment for most of his conscious existence.
In the academic setting, merit counts above all else. Not to say there aren't politics involved, but they usually will take a back seat to achievement. You are graded on how well you do in a given subject. It's all right there in black and white on your school transcripts. And merit is the key to success.
Once you get out in the "real world," the world outside of academia, you will see that few jobs in ANY profession are awarded on merit alone, and I'm not just talking about theatre.
It's usually a combination of "who you know," experience, and last, and usually LEAST ... merit.
This goes for everything from lawyers to nurses to librarians. Merit, more often than not, will only open a door for you with entry-level access, especially if you know no one and have little to no experience. The rest will be up to you. There are exceptions to that rule, but merit is not the norm. And if you get in on merit, you'd better work quickly on who you know and gather some experience.
The person most qualified for whatever job you want to name is far from guaranteed to get it.
Now throw in "artistic" jobs, like acting, dancing, singing, painting, sculpture, etc., where merit is usually a consensus of collective opinions at best. You'll be scratching your head a lot then. Not only are these jobs rarely awarded on merit alone, "artistic" merit is always subjective. It can't be measured by the yard or tallied up by a point-system (despite what they teach you on TV).
Basically, I don't think you'll ever have a firm answer to your question. But hopefully you'll have a better understanding of what you're asking.
"Jaws is the Citizen Kane of movies."
blocked: logan2, Diamonds3, Hamilton22