A full answer to this question is pretty complicated. But two simple factors are:
* Material: who has more and stronger pieces on the board? A typical weighting system is pawn = 1, knight/bishop = 3, usually with the bishop weighted slightly more, rook = 5, and queen = 9, though this can vary. If I’ve traded one of my rooks for two of your knights, I am at a slight advantage: I’ve captured 6 points to your 5.
* Tempo: whose pieces are in a position to be more active? For example, a queen or bishop near the center of the board has more freedom of movement than one near the edge. A rook that is out in the open has more freedom than one walled behind pawns.
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