PP3 calculates overlaps with all objects on the map: stars,
nebulae, constellation lines, boundary lines, and – last but not least
– other labels. All overlaps are weighted, and their sum is the
penalty value. You can influence the weighting. By default, it's
1000 for all objects. But with
penalties stars 2000
you double the significance of stars. Thus you make overlaps of labels with stars less probable. In contrast,
penalties boundaries 0
tells PP3 that printing a label on a boundary line isn't bad at all.1
[1] Avoid negative values, although PP3 doesn't reject them. They wouldn't make sense anyway.