JonB would so kick ass at this, but I'm here first!
Good question, I think it's been argued, that since we've got the largest penis compared to the primates, then there is obviously an advantage, probably due to sexual pleasure.
But I'm not completely sure how penis size is passed on genetically. As an example, if it came exclusively from the mother, say, then there's not much point in her having a well-hung father!
It's probably more like any other trait and passed from both parents though.
There's loads of other factors to consider, such as diet, hormones in the womb (and outside) that effect our final penis size, but I don't think that there is too much of an "advantage" to being bigger than X size. At the end of the day, it's about having children. A population cannot change it there's no body being born! (Well, unless a lot of people die at once, but I doubt all the smaller people are dying young!
The person who has more kids passes on their genes to the next generation, so if all the children ended up average, then the population has already been stablised slightly more around the average. That's not even counting if the exact alleles are not directly linked to each other, so could be inhereted seperately, (ie, a hung dad having smaller offspring).
Then there's population genetics, and it could be "a fluke" that there are more hung alleles in a population...
Blah, I'll end there methinks.
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Or I could simply say, "there's lies, damned lies and statistics!"