Creating drop shadows on papers and elements is an important part of digital scrapbooking. Drop shadowing will give your layers depth, and will help your digital layout look more like real scrapbooking. The key to drop shadows is to keep them subtle and natural looking. I always ask myself before drop shadowing it, “what would this look like in real life, or on a real scrapbook page?”
Here is a basic drop shadow tutorial for use in most of Photoshop CS and Elements. Here I have a background paper with a frame dragged into the LO – no shadows applied at this point.
Now – Here are is the basic drop shadow that comes with each program – see the circled areas:

If you do not see your styles or effect box on your workspace you can go up to the Window menu along your top bar and select either Styles or Effects (styles for PSCS & effects for PSE)
Now notice as I click on the drop shadow button it will create a drop shadow on the layer you have selected. (click apply in PSE)

Now here is the key to a decent drop shadow. Once you have created the effect you need to double click on the Fx icon on the selected layer.

That will pop up window that looks like this:
Click on the word drop shadow (highlighted in my pic) – that will give you options to play with to control your own drop shadow.
I play with the color of the shadow – normally changing it to a brown shade to give a more soft, subtle look, the opacity, the distance and the size. You can see your element's shadow change as you play around with these settings!
(PS Elements is pretty similar, the same options are there!)