Stack sizes can be large for a variety of reasons, but from what I know, the starting stack size for a tournament mostly has to do with the structure of a tournament.
If a tournament is a hyper turbo with 3-minute blinds, you may start the tournament with something like 100,000+ chips and level 1 being 10 SB / 20 BB. This gives players a lot of time to play the tournament and late reg/re-register (if allowed).
Stack sizes might be larger in live tournaments because casinos only have certain denomination tournament chips (100 being the smallest in my experience) because any chips of lower denominations get phased out of play too quickly.
In general though, tournament structures are set up to last an approximate amount of time no matter how many players are involved. Given a blind structure and time for each level, the only variable left to control how long a tournament lasts is stack size. It is also important for players to have a stack of chips to minimize the dealer having to spend time giving change or chopping pots with odd chip values.