We analyze whether research funding contests promote co-authorship. Our analysis combines Scopus publication records with data on the Marsden Fund, the premier source of funding for basic research in New Zealand. We use fixed-effect models to analyze within-researcher-pair variation in co-authorship. Among pairs who ever coauthored or co-proposed, co-authorship was 13.8 percentage points more likely in a given year if they had co proposed during the previous ten years than if they had not. This co-authorship rate was not significantly higher among funded pairs. However, when we increase post-proposal publication lags towards the length of a typical award, we find that funding, rather than participation, promotes co-authorship.