Persistent Shopping Carts
Persistent shopping carts save a customer's cart contents across sessions through "persistent cookies." A cookie is a small text file stored on a user's computer. The cookie can be set to expire after a few minutes, a number of days or even years unless they are wiped out by the user's browser or anti-spyware programs, or the user does not accept cookies.
For example, if the customer bookmarks a product on Monday by saving it to cart, and returns on Sunday to purchase, she doesn't have to locate the product again. This is a nice customer service feature that can save sales. Some users, based on experiences with other sites, might assume your site uses persistent shopping carts, and upon returning to an empty cart, be too frustrated to even bother re-locating the products.
Amazon even reminds you when you added an item:
Amazon has caught me off guard before when I didn't realize I had old stuff in my cart. I added a bunch of items in one session, didn't review my order carefully and ended up receiving (and paying for) an extra wireless mouse! Lesson learned.
The decision to set a cookie that will contain information about what a customer has added to cart is made by the retailer - not all retailers use persistent shopping carts.
Perpetual Shopping Carts
Perpetual shopping carts display the number of items in the cart and sub-total as a shopper navigates the site. Marketing Sherpa recently reported that 64% of retailers believe perpetual shopping carts are "very effective" at improving conversion.
Some sites like Altrec use both persistent and shopping carts, which I recommend.