More PSI = more air into engine = more power. PSI actually means "Pounds per Square Inch".

The only way you'll truly know how much more HP/Torque that a smaller S/C pulley will give you is if you go get some time on the dyno.

Be wary that doing so will add more stress to all the internals of your engine. You may want to set aside some extra money for a stronger crank, bearings, pistons, con rods, and new valve springs too.

Might not be a bad idea to have a more free flowing exhaust too.