<P> In horse racing, the term purse distribution or The Purse may refer to the total amount of money paid out to the owners of horses racing at a particular track over a given period of time, or to the percentages of a race's total purse that are awarded to each of the highest finishers . This article focuses on the latter definition . </P> <P> Prior to the 1970s, only the owners of the first four finishers in a thoroughbred horse race in the United States typically received any money at all; most commonly, 65% of the race's purse was awarded to the winner, with the second, third and fourth horses earning 20%, 10% and 5% respectively . This procedure had some drawbacks, especially in the event of inclement weather--owners would often seek to "scratch," or withdraw their horses from a race, if the track was wet, and even more so if rain forced a scheduled turf, or grass race, to be moved to the main, or dirt, track . It was largely in an effort to encourage larger fields in these circumstances that many American state racing associations began changing their purse - distribution formats during the last three decades of the 20th Century . </P> <P> One frequently - implemented reform was to include horses finishing fifth in the purse distribution; the method most often employed for doing this was to award 60% of the purse to the winner, 20% to second, 11% to third, 6% to fourth and 3% to fifth, a format still observed by many tracks today . Some tracks even went so far as to include the sixth - place runner in the purse as well; most often, this resulted in 60% being given to the winner, 20% to second, 10% to third, 5% to fourth, 3% to fifth and 2% to sixth . </P> <P> In 1975, the state of Florida enacted a purse - distribution format that has had revolutionary implications for the sport of horse racing in the United States: Its adopted plan provided 1% of the purse to all finishers in the race lower than fourth; this meant that the percentages paid out to the horses finishing second, third and fourth (but not first) became variable, depending upon the size of the field . For example, if a race had twelve starters, 60% of the purse went to the winner, 18% to second, 10% to third, 4% to fourth and 1% each to fifth through twelfth; with only six starters the winner received the same 60%, but 20% went to second, 13% to third, 5% to fourth and 1% each to fifth and sixth . This system is still in use at all of the state's thoroughbred tracks today, although a slight modification in the actual percentages (resulting in the second - place share being increased at the expense of the third and / or fourth) was made in 2005 . </P>

Where does the prize money come from in horse racing