As a general rule, we encounter more legendary material in ancient biographical texts in those parts of the narrative that are devoted to the hero's nativity and youth….
When Jesus was born - far more probably in Nazareth than in Bethlehem, though his place of birth ultimately remains uncertain - no one among his family or fellow villagers expected anything special from him, and thus nobody paid any special attention to him. No historically reliable traditions of Jesus' childhood have survived, nor would one expect that an ordinary craftsman's family in a collectivist society (even if it claimed Davidic provenance, which is doubtful) would engage in collecting memories of a family member's individual development….We must not confuse the world of high-ranking persons who documented their important lives with the world of nobodies from which Jesus originated. Of course, things changed when Jesus' career as a prophet of the kingdom of God and a successful healer unfolded….In the first decades after the resurrection, several concepts coexisted in the Christ-believing communities. Memories were refracted, and where no memory was extant - as was probably the case with the birth of the one who was now believed to be the Messiah and thus the Son of David - traditions were invented to meet the requirements of the beliefs that had developed. (466, 491-2)
Regarding material about the youth of an individual in ancient biographies, Richard Bauckham writes:
"One point at which Lincoln is wrong is that he claims biographers themselves made up stories about portents and remarkable events connected with the births of important people. (Miraculous births and conceptions as such are very rare, prophecies and portents more common.) What the biographers (Plutarch, Suetonius and others) actually do is report stories that were already circulating. They say so. Sometimes they report them without committing themselves to their truth. Sometimes they have no such stories, presumably because there were none available to them. So I don’t think we should assume that such things were understood as just a literary convention or conclude too readily that Luke would have just composed his birth narratives de novo."
Furthermore, the general rule Merz appeals to is just that: a general rule. Other factors have to be taken into account along with it, such as the age and provenance of a biography (or any other source). If an ancient document that makes claims about a figure's youth was written without much concern for accuracy, without much scrutiny applied by early audiences, long after the lifetime of the individual whose biography is being provided, or with political motivations, for example, we would distinguish between that document and another document that doesn't have those negative characteristics. The fact that the average ancient biography had a particular characteristic doesn't prevent us from exempting a biography from that average if there's evidence justifying an exemption.
One of the reasons why we distinguish between miracles associated with Jesus' childhood and miracles associated with the childhood of other figures is that other aspects of Jesus' life justify that distinction. His major role in human history makes him a far more plausible candidate for miraculous activity than other individuals, as do the claims he made about himself, the evidence we have for miracles in his later life, etc. Similarly, Tiger Woods' adulthood justifies an expectation that golf had a larger role in his childhood than it had in the childhood of the average person, that he had better golf skills in his childhood than the average person, etc. Jesus is the central figure of human history, the leader of the largest religion in the history of the world, and the centerpiece of an ongoing system of miracles spanning thousands of years, miracles far higher in quantity and quality than we can attribute to other figures for whom we have ancient biographies. See, for example, Craig Keener's Miracles (Grand Rapids, Michigan: Baker Academic, 2011). Jesus is a far more plausible candidate for supernatural activity than Romulus, Alexander the Great, Augustus, Apollonius of Tyana, and the other figures who were subjects of ancient biographies.
If "no historically reliable traditions of Jesus' childhood have survived", and "no memory was extant", then where is Merz getting her conclusions about his childhood (that he was "far more probably" born in Nazareth, that his family was "an ordinary craftsman's family" during Jesus' childhood, that Jesus' family didn't claim Davidic ancestry, etc.)? Maybe she's claiming that the conclusions we can reach about his childhood are implications of what we know about his adulthood or come from other sources that aren't childhood traditions. But even if that were the case, it would be significant that we can reach some conclusions about his childhood by means of the implications of non-childhood traditions.
The idea that we have no reliable childhood traditions for Jesus is absurd. When something like the premarital timing of Mary's pregnancy meets the criterion of embarrassment, meets the criterion of multiple attestation, is reported as early as the first century A.D., is corroborated by early non-Christian sources, and isn't contradicted by any source with credibility equal to or better than the sources who affirm it, why are we supposed to believe that it isn't a reliable tradition? There are other traditions about Jesus' childhood that also have such characteristics, and Merz's chapter doesn't give us any reason to reject those childhood traditions either. My posts here and here provide many examples.
Whether Jesus' childhood was as ordinary as Merz suggests is a disputed issue. If the events of the infancy narratives or comparable events occurred, then some people would have had reason to remember such events and to recount them later in Jesus' life and after his death. He and his family weren't part of the "world of nobodies" in the manner Merz claims. There were some aspects of their lives that were ordinary and others that weren't.
Merz acknowledges that "things changed" after Jesus' public ministry began in his adulthood. When that occurred, his mother, some siblings, other relatives, and other figures who were contemporaries of Jesus' childhood were still alive. There's reason to think some of them had a high view of Jesus prior to his public ministry, as we'll see later. But even among those who didn't think much of him until after his public ministry began, there would have been some memories of his childhood. You don't have to be born into a royal family or have some comparable background for people to have memories of your youth.
Jesus' public ministry involved matters of social status, prophecy fulfillment, and Messianic expectations. People would have been interested in his background in those contexts. Some of the most prominent expectations for the Messiah in ancient Judaism were about the Messiah's childhood. That's why issues of ancestry, the disreputableness of Nazareth, how Jesus' neighbors and relatives were reacting to him, and objections his opponents raised about his background come up in the gospels and other early sources. Jesus' mother, brothers, and other relatives were active in Christianity, and sometimes held high positions of leadership, even for a few decades or more past the time of Jesus' death. Those relatives were identified as relatives of Jesus, were held in high regard, traveled widely, were highly accessible, and were widely discussed for decades (Acts 1:14, 12:17, 1 Corinthians 9:5, Galatians 1:19, 2:9-10, James 1:1, Jude 1, etc.). The material on Jesus' childhood in Luke's gospel comes from a source who had been in contact with James (Acts 21:18) and begins his material on Jesus' childhood just after explaining his concern for historical research and eyewitness testimony (Luke 1:1-4). The Christian movement began with access to Jesus himself. If Matthew wrote the gospel attributed to him or had some other significant role in its publication, as I've argued elsewhere, he would have had a lot of access to and time spent with Jesus himself and his mother, along with Jesus' siblings and other relevant sources. In the sort of context I've been describing in this paragraph, it would be remarkable if "no historically reliable traditions of Jesus' childhood have survived" and "no memory was extant". The scenario Merz is arguing for is extremely unlikely.
(Other parts in this series: part 3, part 4, part 5.)