There is hardly any scope for disagreement about merit as the sole criterion for promotions. Merit, no doubt, should be the main criterion for rewarding a person whose performance is evaluated for promotion to a higher position. However, merit and knowledge have to be evaluated in a manner that is logical, transparent, and above all fair, to all concerned. We have to agree that knowledge and merit are essentially a subjective measures yet if required even it can be quantified.
Quantitative or objective assessment of academic pursuits may be feasible to an extent but in the long run it does not sound prudent. It is difficult to accept that a person publishing one paper is less knowledgeable than a person publishing four of them just because the senior person devoted more time to managing the things prudently.
Then comes the main issue. We are discussing about promotion. Promotion for what? Surely we get promotion if the school, company or office we are working for get promoted in terms of achievements, results, sales , service etc.
A new comer should not be given and is never given promotion to a higher grade the day he joins. With the passage of time in the company, superiors decide their actions for protecting the interest of the corporation. It means that new recruit becomes experienced and his knowledge with the suitable experience as felt by the superiors is rewarded in the interest of the corporation.
People may argue that only seniority can rule out favoritism or discrimination and that measurement of seniority is the most simple and exact.
Then you will find many people in the company who are working for the company but at all forum bring down the company. These people based on their performance and attitude are judged and decisions are taken. These peoples are good for nothing and if these peoples are given promotion based on their experience, there is no doubt, good people working under such dead wood will not stay with the corporation and the corporation will die at its own. PSU's are very good example of this.
If experience becomes the sole criterion, - after doing work initially with vigor & velocity one may lose his/her zeal & zest knowing quite well that all his/her hard work will go in vein over the experience factor to achieve rewards & recognition & hence he/she might get demotivated and work may become just a ritual. I conclude by reiterating that Promotion on the basis of knowledge ensures that only the best employees are promoted.