How precisely does the StarCraft 2 handicap feature work?

I asked in this question how I could introduce additional handicaps into StarCraft 2 to make it easier to play with my friends without relying solely on the built-in handicapping system. However, it just occurred to me that I don't actually know what the built-in handicapping system actually does.

What does the built-in handicapping system do, precisely? Does it affect unit HP, attack power, income rate, or other things? Does lowering the handicap percentage from 100% help or hinder you?

Solution 1:

Handicap reduces the HP of your buildings and units to be the specified percentage of its full value. For Protoss units and buildings, both the HP and shields are reduced to that percentage.

So setting it at 90% means that a 150 HP unit will become a 135 HP unit (10% less). Setting it at 50% on a probe means that probe will have 10 HP and 10 shields. In cases where the result is a fraction, it is rounded up.

Here's a marine with 80% handicap value (and the nearby command center has 1200 HP):

Solution 2:

According to This Thread i found on google it just reduces your units HP by this percentage.