Jordan Peterson describes it best. If you don't have a top and bottom, how do people know how to pull themselves up? 

Having said that, I want to tell you my experience of teaching in a SMALL k-8 school of about 300 kids. The grade 8s (all app. 23 of them) would have a graduation and awards night. Every year, all awards were given out, even if some years nobody deserved the award. Usually, there was usually one or two students who actually deserved all the awards, as they had a good work ethic and were smart. However, for the sake of appearances, the same student could not win all the awards. Thus, as a French teacher, I had to choose a student who was very far from the best to nominate.  Similarly, the spec. ed. teacher handed out an award to a kid who was most improved - even though the kid had done little improvement. The awards situation was a crock. Too small a comparison pool!

At least by spreading out awards between sport and academics the recognition is differentiated.