PageRank is passed from one website page to another through backlinks. More backlinks typically means higher PageRank values. Stanford University’s patent (licensed to Google) includes the following formula describing PageRank.
PRA = (1-d) + d (PRT1/CT1 + … + PRTn/CTn)
PageRank of a source page is equally distributed (passed) through all the links that reside on that page to each backlink page. A few examples will help illustrate the concept.
Link Reputation is often times the more important aspect of a backlink. When backlink text (hypertext or anchor text of a link) includes the keywords, it is said to have high Link Reputation.
For example, many Internet links to www.gerber.com read “Gerber baby food”. Since the keyword phrase “baby food” is found within the hypertext link, search engines associate the phrase “baby food” with www.gerber.com. This association of keyword – hypertext with the target link produces stronger search engines rankings for that keyword.