Google knows it as pagerank ™ while Yahoo have their own version called webrank. Microsoft too, may roll out its own model known as Browerank.

 This concerns both the relationship between your pages and all pages that you are connected to. Further still, is the relationship of all pages.

There are a few ways to look at it

• The complex, mathematical and everchanging method - Whats the point?
• Or the basic approach

Basic principle.

• Get links into your site, preferably using anchor text.
• Do so, with some knowledge / research into the stranger bearing gifts. The Google Toolbar may offer a rough or loose indication, so you could go by that reservedly.
• The more incoming links from sites of some repute, the better the chance of ranking well.
• More outbound links will dilute pagerank, unless one uses the nofollow attribute.
• Extra on-site pages will increase the theoretical potential, for a higher pagerank. This depends on how it is done and is probably not even worth examining, for the majority of sites.
• Each indexed page, may start with a basic pagerank value which some believe to be one, and can increase to ten. The likes of http://www.w3.org/ is ten.
• A page can't have any Pagerank ™, unless at least one other page is linking to it. A page without incoming links from anywhere, is known as an orphaned page (no parents or heirarchy).
• Pagerank from incoming links is a P.R. exercise. ......a linking ladder to "authority".
• Each page on the visible / crawlable web, has a relationship with each other and calculations are made and remade from this point.
• It is also a load of rubbish, an area of extreme...........sensationalism, speculation, obsession, ignorance and indifference of course. 

Don't believe the familiar rhetoric that people will link to you, if you have real and unique content. This can  /may, only happen if you belong to one of the following (in no particular order);

• government
• community ( includes members of Universities, Colleges by other names, and actual communities to a limited degree )
• webring
• highly popular topic ( incidental )
• accident by location, timing or resource. ( yes, it happens often , very often)

Otherwise, one must try to create favourable circumstances. See Building Content.