PR calculation from the year 2007 is not very accurate, but it gives us a raw idea of how it is calculated.
Through the chart below, we can conclude that getting a few backlinks from authoritative sites is much more effective than getting hundreds of backlinks from low quality sites. A website that barely qualifies for PR 5 may only have 5,033 votes, while a very strong PR 5 website might have 27,213 votes.
Page Rank Calculation | |||||||||||||
|---|---|---|---|---|---|---|---|---|---|---|---|---|---|
Start | End | Median | Median | Links | Links | Links | Links | ||||||
PR | Range | Range | Value | PR Passed | for PR5 | for PR6 | for PR7 | for PR8 | |||||
1 | 6 | 30 | 15 | 0.37 | 13,442 | 73,931 | 406,621 | 2,236,418 | |||||
2 | 30 | 164 | 82 | 2.06 | 2,444 | 13,442 | 73,931 | 406,621 | |||||
3 | 166 | 900 | 453 | 11.33 | 444 | 2,444 | 13,442 | 73,931 | |||||
4 | 915 | 4,948 | 2,492 | 62.29 | 81 | 444 | 2,444 | 13,442 | |||||
5 | 5,033 | 27,213 | 13,704 | 342.61 | 15 | 81 | 444 | 2,444 | |||||
6 | 27,681 | 149,670 | 75,374 | 1,884.35 | 2.6709 | 14.690 | 80.794 | 444.365 | |||||
7 | 152,244 | 823,186 | 414,557 | 10,363.94 | 0.4856 | 2.671 | 14.690 | 80.794 | |||||
8 | 837,339 | 4,527,522 | 2,280,066 | 57,001.65 | 0.0883 | 0.486 | 2.671 | 14.690 | |||||
9 | 4,605,367 | 24,901,372 | 12,540,364 | 313,509.09 | 0.0161 | 0.088 | 0.486 | 2.671 | |||||
10 | 25,329,516 | 136,957,543 | 68,972,000 | 1,724,300.01 | 0.0029 | 0.016 | 0.088 | 0.486 | |||||
Assumption: | 85% | of_median_value_passed | |||||||||||
Assumption: | 40 | links_per_page_average | |||||||||||
PR is basically a popularity contest, each site linked to yours counts as a vote. If the votes come from low PR sites, you won't win the crown.

[Via: ZippyCart Shopping Cart Reviews]
View Larger Image and Get the Embed Code to Add This Infographic to Your Site.
Note: only do follow link pass the PR juice, so no follow link do not help to increase PR. No Follow Link Attribute: <a href="http://www.example.com/" rel="nofollow">Example</a>
Still not enough? Read articles collected by sitepoint to know more about the backend workings of PR.
Stanford University: Thesis of Google's creators
http://www-db.stanford.edu/~backrub/google.html
PR and Link Structure
http://www.sirgroane.net/google-page-rank/
PR Concept
http://pr.efactory.de/e-pagerank-algorithm.shtml
Link Types and PR calculator
http://www.webworkshop.net/pagerank_calculator.php3
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