Merit (Oxford English Dictionary):
1b. The quality of deserving well, or of being entitled to reward or gratitude.
1c. Claim or title to commendation or esteem; excellence, worth.
Meritocracy (Oxford English Dictionary):
government (or holding of power) by people chosen on the basis of merit (as opposed to wealth, social class, etc.);
a society governed by such people or in which such people hold power; a ruling, powerful, or influential class of educated or able people. Also in extended use.
Originally spec. with reference to ‘merit’ as assessed by a competitive educational system.
[potential contrasts: nepotism, cronyism]
Merriam-Webster.com: a system in which the talented are chosen and moved ahead on the basis of their achievement
from Wikipedia: Term coined by Michael Young in 1958 to describe a system where "merit is equated with intelligence-plus-effort, its possessors are identified at an early age and selected for appropriate intensive education, and there is an obsession with quantification, test-scoring, and qualifications." By extension, a system of government or other administration (such as business administration) wherein appointments and responsibilities are objectively assigned to individuals based upon their "merits," namely intelligence, credentials, and education,determined through evaluations or examinations. (Historical precedents: 2nd century Han China, influenced by Confucius, instituted civil service exams.
In his book Twilight of the Elites: America After Meritocracy (2012), Chris Hayes attributes what he calls the "Fail Decade"—which includes 9/11, the Enron Scandal, the invasion of Iraq, Hurricane Katrina, the subprime crisis, and the Great Recession—to the deterioration of America's meritocratic system into one of plutocracy.
Dr. White's Notes:
"Meritocracy: It's not who you know, it's what you know."
Education is the most established testing-ground of meritocracy, but lately I've read critiques that say doing well at school only prepares you for doing well at school.
The U.S. military (and other modern militaries) may sometimes be described as a meritocracy because promotion and advancement are theoretically based on training, testing, and performance. In the early years of the United States, the military was thus formed in contrast to Great Britain's officer corps, which was formed of gentlemen who rose in rank through social prestige and wealth.
(Possible exceptions: graduates of military academies may be favored for promotion over those who work their ways up through the ranks.)
Meritocratic reputation creates challenges or expectations leading to recognition and resolution of social inequality.
U.S. Civil War: African American soldiers service for the Union helped generate momentum for the 14th Amendment to the U.S. Constitution granting citizenship to African Americans.
World War 1: African American activist and scholar W.E.B. Du Bois (& others) campaigned against racial segregation in the U.S. Armed Forces and succeeded in at least getting more equal housing and conditions.
Post-World War 2: President Truman ended racial segregation in the U.S. Military--often cited as first move in post-World War 2 Civil Rights Movement. (Implicit: if you're willing to fight and die for our nation, you're entitled to equal status.)
Vietnam War: lowering of the voting age from 21 to 18: "If we're old enough to fight, we're old enough to vote." (Ironically, the subsequent raising of the drinking age led to, "If we're old enough to vote, we're old enough to drink.")
1990s-2000s debate over "Gays in the Military": advocates for change argued that willingness and competence to serve outweighed identity issues, while opponents countered with threats to "military cohesion and readiness." In 2010 Congress repealed the military's "Don't Ask, Don't Tell" policy; in 2011 the U.S. Military released new guidelines concerning gays in the military.
2013: U.S. Secretary of Defense with Joint Chiefs of Staff lifted prohibition against women serving in combat. To uphold meritocratic standards, however, military guaranteed that standards for performance and testing would not be compromised.