Throughout the past three years, the rules regarding nofollow attributes have changed through the eyes of Google. Let’s take a look at the best practices now as compared to prior to these changes. But first here is, in brief, the concept of PageRank sculpting.
The idea of PageRank sculpting is that you can control the flow of your link juice on your website by using the nofollow attribute. For example: if you have four links on a page and one of those links has a nofollow tag then the remaining three links are the only links that will pass a percentage of the PageRank of the current page to the pages they are linking to.
Here is where the biggest change has taken place. Prior to the summer of 2009, the three links that were passing link juice would have each passed 33% of the PageRank. Over the summer of 2009, Google announced that nofollow links will continue to not pass link juice, however, their percentage of PageRank will be discarded and not shared with the remaining links on the page. So going back to our example, the remaining three links will now each pass 25% of the PageRank and the remaining 25% will be lost.
The simple conclusion to this is to remove any nofollows you have on the internal linking structure of your site. Even if you have a few pages that you are not concerned with getting a good PageRank, those pages can still pass the link juice onto other pages, and thus the cycle continues.