There are many cases in GIS workflows where you need to merge a polygonal dataset based on a common attribute. A typical example is merging the European administrative areas (which you can see at http://en.wikipedia.org/wiki/Nomenclature_of_Territorial_Units_for_Statistics), starting from Nomenclature des Units Territoriales Statistiques (NUTS) level 4 to obtain the subsequent levels up to NUTS level 1, using the NUTS code or merging the USA counties layer using the state code to obtain the states layer.
PostGIS lets you perform this kind of processing operation with the ST_Union function.
