That's the big question, isn't it?
But let's first lay down some parameters. We're talking about a tuned ST- with stock turbos, etc.
It's not unlikely that ON A DYNO a larger exhaust might produce a bit more peak horsepower. But as I've pointed out (
here), in a real-world track environment, you modulate the pedal and shift. In that case, having a higher exhaust velocity (smaller pipe) is beneficial.
Think of it from another point of view- the intake port. You can size an intake port that achieves the best possible port speed (around 100m/s) at say 6500RPM or redline. Or, you can size that port slightly smaller so that the optimal port speed occurs at a lower RPM. You size it smaller because under racing conditions you're not operating at 6500 all the time. So you size it based on the average between the max RPM and lower RPM of your normal operating range- usually a shift point.
Does that help? Oh, and please click the link above if you haven't read it. I don't get paid for views!