Posted by randfish
The blog post – PageRank Sculpting – from the head Google's Web Spam team is a critical read for SEOs worldwide:
So what happens when you have a page with “ten PageRank points” and ten outgoing links, and five of those links are nofollowed? Let’s leave aside the decay factor to focus on the core part of the question. Originally, the five links without nofollow would have flowed two points of PageRank each (in essence, the nofollowed links didn’t count toward the denominator when dividing PageRank by the outdegree of the page). More than a year ago, Google changed how the PageRank flows so that the five links without nofollow would flow one point of PageRank each.