At least one-half of Merchant was written in the same period and in the same places as Our Town (the MacDowell Colony in New Hampshire, ships at sea, and hotel rooms on both sides of the Atlantic, to start a long list) and Wilder sent Reinhardt, now a political refugee living in Los Angeles, the first two acts shortly after Our Town opened on Broadway on February 4, 1938. By early March, Wilder had fled to a rented apartment in Tucson, Arizona to complete the work. Here, by telegram, he learned the wonderful news that Reinhardt was “entzücht” (charmed) by what he had read. In addition to Wilder’s love affair with farce and Reinhardt’s interest in the play, the playwright now had another driving reason to complete Merchant. He had been surprised that Our Town left audiences feeling so sad, or, as he put it in a letter from Tucson to his friend and confidante Lady Sibyl Colefax in London, that Our Town “raises a devastating pessimism, a repudiation of the state of being alive.” More than ever Wilder wanted to show how the stage could also be employed to make audiences laugh. Still, though The Merchant of Yonkers was a farce, Wilder wrote Colefax that he was also weaving into it “trenchant sparks of social comment,” his polite way of describing the play’s treatment of the effects of wealth on individual behavior and on society.

The importance of the “trenchant” theme in a work that celebrates such sacred ingredients of farce on the stage as disguises, mixed identities, hiding and leaping out of hidden places, and, of course, love, cannot be exaggerated. He wrote to Ruth Gordon (June 21, 1938) about Reinhardt’s reception of his serious message with these words:

In some trembling I read him the (new) monologue that Mrs. Levi has in Act IV and asked him whether it was not too earnest for the play. When I was finished he looked at his wife [actress Helene Thimig] and said in German: You see, he is a poet and turned to me and said: No, I have always said that in a comedy—and near the end—there should always be one moment of complete seriousness and by that the audience can see that also comedy parts are not just pastime.

By mid-July the acting drafts for Act III and IV had been typed and names of actors began to be tossed around for a play Reinhardt hoped to mount in Los Angeles, among them Mickey Rooney as Barnaby and Charles Boyer as Cornelius.

But nothing about theater is predictable. Because of a change in Reinhardt’s schedule, theatrical producer Herman Shumlin arranged with The Theatre Guild for Merchant to be born the traditional way, in the East—an out-of-town tryout followed by a Broadway opening. After a short and frantic rehearsal period, a strategy not recommended for a theatrical form with as many tricky moving parts as farce, The Merchant of Yonkers opened in Boston in December. It was an omen for the disaster that lay ahead that the three top choices for the key role of Dolly—Dame Edith Evans, Ina Claire (a frequent in Behrman’s plays), and even Wilder’s friend and confidante Ruth Gordon—turned down the part. The producers were forced to settle on Jane Cowl (1883–1950), a headliner, but an actress whom they had initially passed over. Wilder’s view of her before she was picked was that she “affected ‘great lady’ dignity unsuitable to us.”