The diameter of your exhaust tip is directly proportional to your engine horsepower. As an example, look at a stock Civic. From the factory, with 1" pipe, they have roughly 110 hp or so. Now, when you average teenager welds on a 5" exhaust tip, horsepower is INSTANTLY increased to well over 200. There is no need to increase the actual size of the pipe, as this has no bearing on actual exhaust flow/output whatsoever, just the tip is what is important. Also, it seems, sound has a factor too. The louder it is, the more afraid other cars/drivers will be therefore decreasing thier horsepower as a side benefit. Police, however, know this and have been known to issue citations. Hope this helps!
-Ken