Johnboy's right on, if referring to the higher-end NLEs. In PP, you'd use the Effect Controls tab, open the Motion options and use Scale and Position to create the effect.
The cheaper ones, however, are often limited in the number of tracks you can resize, etc. In Pinnacle Studio 9, I believe you had to use the PIP effect and it could only be used on one track at a time. This required that you render out to a new clip; import that clip and add the next PIP track, etc. Most times it would crash my computer and, I'm told, it once brought down the entire Internet and disrupted traffic lights throughout Oklahoma City! X-D