Link schemes
Your site's ranking in Google search results is partly based on analysis of those sites that link to you. The quantity, quality, and relevance of links count towards your rating. The sites that link to you can provide context about the subject matter of your site, and can indicate its quality and popularity. However, some webmasters engage in link exchange schemes and build partner pages exclusively for the sake of cross-linking, disregarding the quality of the links, the sources, and the long-term impact it will have on their sites. This is in violation of Google's webmaster guidelines and can negatively impact your site's ranking in search results.
Examples of link schemes can include:
· Links intended to manipulate PageRank
· Links to web spammers or bad neighborhoods on the web
· Excessive reciprocal links or excessive link exchanging (”Link to me and I’ll link to you.”)
Buying or selling links that pass PageRank
According to Google, these are some of the reasons why a blog/site can be penalized and have a lower page rank.
Google says that you should have not more than 100 URLs of allsites including yours in a page. Google takes seriously the cases like
"link farming", buying links, spamming, etc.