diff --git a/apps/openmw/mwrender/objectpaging.cpp b/apps/openmw/mwrender/objectpaging.cpp
index 0d547184c..5438347a1 100644
--- a/apps/openmw/mwrender/objectpaging.cpp
+++ b/apps/openmw/mwrender/objectpaging.cpp
@@ -285,6 +285,8 @@ namespace MWRender
     {
         mMergeFactor = Settings::Manager::getFloat("object paging merge factor", "Terrain");
         mMinSize = Settings::Manager::getFloat("object paging min size", "Terrain");
+        mMinSizeMergeFactor = Settings::Manager::getFloat("object paging min size merge factor", "Terrain");
+        mMinSizeCostMultiplier = Settings::Manager::getFloat("object paging min size cost multiplier", "Terrain");
     }
 
     osg::ref_ptr<osg::Node> ObjectPaging::createChunk(float size, const osg::Vec2f& center, const osg::Vec3f& viewPoint, bool compile)
@@ -358,7 +360,9 @@ namespace MWRender
         typedef std::map<osg::ref_ptr<const osg::Node>, InstanceList> NodeMap;
         NodeMap nodes;
         AnalyzeVisitor analyzeVisitor;
-
+        float minSize = mMinSize;
+        if (mMinSizeMergeFactor)
+            minSize *= mMinSizeMergeFactor;
         for (const auto& pair : refs)
         {
             const ESM::CellRef& ref = pair.second;
@@ -381,7 +385,7 @@ namespace MWRender
                 SizeCache::iterator found = mSizeCache.find(pair.first);
                 if (found != mSizeCache.end())
                 {
-                    if (found->second < d*mMinSize)
+                    if (found->second < d*minSize)
                         continue;
                 }
             }
@@ -402,7 +406,7 @@ namespace MWRender
             osg::ref_ptr<const osg::Node> cnode = mSceneManager->getTemplate(model, false);
 
             float radius = cnode->getBound().radius() * ref.mScale;
-            if (radius < d*mMinSize)
+            if (radius < d*minSize)
             {
                 OpenThreads::ScopedLock<OpenThreads::Mutex> lock(mSizeCacheMutex);
                 {
@@ -435,23 +439,26 @@ namespace MWRender
             float mergeBenefit = analyzeVisitor.getMergeBenefit(analyzeResult) * mMergeFactor;
             bool merge = mergeBenefit > mergeCost;
 
-            // add a ref to the original template, to hint to the cache that it's still being used and should be kept in cache
-            templateRefs->mObjects.push_back(cnode);
-
-            if (pair.second.mNeedCompile)
-            {
-                int mode = osgUtil::GLObjectsVisitor::COMPILE_STATE_ATTRIBUTES;
-                if (!merge)
-                    mode |= osgUtil::GLObjectsVisitor::COMPILE_DISPLAY_LISTS;
-                stateToCompile._mode = mode;
-                const_cast<osg::Node*>(cnode)->accept(stateToCompile);
-            }
+            float minSizeMerged = mMinSize;
+            float factor2 = mergeBenefit > 0 ? std::min(1.f, mergeCost * mMinSizeCostMultiplier / mergeBenefit) : 1;
+            float minSizeMergeFactor2 = (1-factor2) * mMinSizeMergeFactor + factor2;
+            if (minSizeMergeFactor2 > 0)
+                minSizeMerged *= minSizeMergeFactor2;
 
+            unsigned int numinstances = 0;
             for (auto cref : pair.second.mInstances)
             {
                 const ESM::CellRef& ref = *cref;
                 osg::Vec3f pos = ref.mPos.asVec3();
 
+                if (minSizeMerged != minSize)
+                {
+                    float d = (viewPoint - pos).length();
+                    float radius = cnode->getBound().radius() * cref->mScale;
+                    if (radius < d*minSizeMerged)
+                        continue;
+                }
+
                 osg::Matrixf matrix;
                 matrix.preMultTranslate(pos - worldCenter);
                 matrix.preMultRotate( osg::Quat(ref.mPos.rot[2], osg::Vec3f(0,0,-1)) *
@@ -474,6 +481,21 @@ namespace MWRender
                     mergeGroup->addChild(trans);
                 else
                     group->addChild(trans);
+                ++numinstances;
+            }
+            if (numinstances > 0)
+            {
+                // add a ref to the original template, to hint to the cache that it's still being used and should be kept in cache
+                templateRefs->mObjects.push_back(cnode);
+
+                if (pair.second.mNeedCompile)
+                {
+                    int mode = osgUtil::GLObjectsVisitor::COMPILE_STATE_ATTRIBUTES;
+                    if (!merge)
+                        mode |= osgUtil::GLObjectsVisitor::COMPILE_DISPLAY_LISTS;
+                    stateToCompile._mode = mode;
+                    const_cast<osg::Node*>(cnode)->accept(stateToCompile);
+                }
             }
         }
 
diff --git a/apps/openmw/mwrender/objectpaging.hpp b/apps/openmw/mwrender/objectpaging.hpp
index 71a0db996..c85fe3705 100644
--- a/apps/openmw/mwrender/objectpaging.hpp
+++ b/apps/openmw/mwrender/objectpaging.hpp
@@ -42,6 +42,8 @@ namespace MWRender
         Resource::SceneManager* mSceneManager;
         float mMergeFactor;
         float mMinSize;
+        float mMinSizeMergeFactor;
+        float mMinSizeCostMultiplier;
 
         OpenThreads::Mutex mDisabledMutex;
         std::set<ESM::RefNum> mDisabled;
diff --git a/files/settings-default.cfg b/files/settings-default.cfg
index ec5e87016..bb21df73e 100644
--- a/files/settings-default.cfg
+++ b/files/settings-default.cfg
@@ -115,6 +115,12 @@ object paging merge factor = 1500
 # Cull objects smaller than this size divided by distance
 object paging min size = 0.01
 
+# Adjusts 'min size' based on merging decision. Allows inexpensive objects to be rendered from a greater distance.
+object paging min size merge factor = 0.6
+
+# Controls how inexpensive an object needs to be to utilize 'min size merge factor'.
+object paging min size cost multiplier = 4
+
 [Fog]
 
 # If true, use extended fog parameters for distant terrain not controlled by