Competition in any form brings out the best in people and pushes them to excel. In schools, if used effectively, it can enhance learning significantly.
Certainly, competition in the classroom is quite healthy; it should, in fact, be encouraged. It allows students to extend themselves, to exploit their real capabilities and maximize their true potential. It is most productive when it occurs among students of similar abilities.
Traditionally, schools have fostered competition among students by assigning positions at the end of the term/semester. Each student is assigned a position based on the average score obtained from an aggregate of tests and assignment scores. In fact, some schools give positions by subject as well as overall class position so a student may have come in the third position, but might have gained first place in Math.
Usually, the diligent student is concerned about the position that he/she acquires and no good student wants to move from a high position in the class, to a lower one. This keeps competition alive and well in the classroom. Students are able to match their abilities against that of their classmates and easily determine who their rivals are. In other words, they evaluate their own competencies and recognize who their competitors are.They can then decide how much effort they need to put into their work in order to remain at the top. Over time, they might also acknowledge that there are certain students whom they cannot match and to whom they must concede defeat.