On Context-Free Grammar Induction by Incremental Compression Thomas Peetz Abstract: State merging algorithms are predominant in Grammar Induction of finite state machines. This thesis extends the state merging approach to context-free grammars. It connects current standard implementations of state merging to compression-based learning. The exact same design principles are applied to the construction of a context-free grammar induction algorithm. The resulting induction algorithm is analyzed in terms of convergence, runtime, and data requirements.