I have merged a bunch of shapefiles in ArcCatalog and get the "the selected file failed to draw...." error. Every thing has merged alright in the db.
I'm new to GIS and could use some help.
Each of the shapefiles that were imported to ArcCatalog are an aggregate of the following file extensions: •.dbf •.prj •.shp •.shp (xml) •.shx
Answer
There are some definite known limitations regarding using shapefiles, but if you are looking to consistently use large datasets with too many features for a shapefile, I'd see if merging the shapefiles into a feature class in a File Geodatabase would work with your workflow as geodatabases are much more efficient at handling large datasets. Additionally, as mentioned by @Michael_Miles-Stimson (see comment to other answer) there other additional benefits to using a geodatabase rather than a shapefile. The main consideration before committing to a switch away from the shapefile is to make sure all intended users of the data will be using software that can utilize the new data format. Shapefile is a very widely recognized standard accepted by most GIS software, though the File Geodatabase is usable by a growing number of GIS softwares as well and is definitely usable by ArcGIS & QGIS systems.
The following link documents some of the known limitations of Shapefile size that I think may be the cause of your issue: http://support.esri.com/em/knowledgebase/techarticles/detail/37447
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