We develop and test a model for the cosmological role of mergers in the formation and quenching of red, early-type galaxies. By combining theoretically well-constrained halo and subhalo mass functions as a function of redshift and environment with empirical halo occupation models, we predict the distribution of mergers as a function of redshift, environment, and physical galaxy properties. Making the simple Ansatz that star formation is quenched after a gas-rich, spheroid-forming major merger, we demonstrate that this naturally predicts the turnover in the efficiency of star formation and baryon fractions in galaxies at ~ -->L* (without any parameters tuned to this value), as well as the observed mass functions and mass density of red galaxies as a function of redshift, the formation times of early-type galaxies as a function of mass, and the fraction of quenched galaxies as a function of galaxy and halo mass, environment, and redshift. Comparing our model to a variety of semianalytic models in which quenching is primarily driven by halo mass considerations or secular/disk instabilities, we demonstrate that our model makes unique and robust qualitative predictions for a number of observables, including the bivariate red fraction as a function of galaxy and halo mass, the density of passive galaxies at high redshifts, the emergence/evolution of the color-morphology-density relations at high redshift, and the fraction of disky/boxy (or cusp/core) spheroids as a function of mass. In each case, the observations favor a model in which some mechanism quenches future star formation after a major merger builds a massive spheroid. Models where quenching is dominated by a halo mass threshold fail to match the behavior of the bivariate red fractions, predict too low a density of passive galaxies at high redshift, and overpredict by an order of magnitude the mass of the transition from disky to boxy ellipticals. Models driven by secular disk instabilities also qualitatively disagree with the bivariate red fractions, fail to predict the observed evolution in the color-density relations, and predict order-of-magnitude incorrect distributions of kinematic types in early-type galaxies. We make specific predictions for how future observations, for example, quantifying the red fraction as a function of galaxy mass, halo mass, environment, or redshift, can break the degeneracies between a number of different assumptions adopted in present galaxy formation models. We discuss a variety of physical possibilities for this quenching and propose a mixed scenario in which traditional quenching in hot, quasi-static massive halos is supplemented by the strong shocks and feedback energy input associated with a major merger (e.g., tidal shocks, starburst-driven winds, and quasar feedback), which temporarily suppress cooling and establish the conditions of a dynamically hot halo in the central regions of the host, even in low-mass halos (below the traditional threshold for accretion shocks).
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