This section is short, but necessary. Many sites have more than one URL, or link name, for their main page. Obviously, you want incoming links to direct visitors to your main page - it's where you grab them, where they find out what your site offers. It's where you want to concentrate your PageRank, so others will find you. But search engines will assign a PageRank to each such link they can find, and for each different URL you have for your page, you're diluting your PageRank.
For example, your web site may well serve up the same main web page for each of the following:
Perhaps not a big problem, but better that only one URL pointed to my main page - enough, maybe, to take its PageRank to 4. It might seem a small thing, but this one point would take a page much higher on a Google search!
I identified two reasons for this discrepancy: one, that a number of pages on my site pointed to just http://www.ars-informatica.ca/, and two, that when I requested link exchanges, I would ask that the other site point to this address.
Note: were I to do this over again, I would prefer to have my main page point to http://www.ars-informatica.ca - a so-called "clean" URL. If I change my web site layout, index.php might well be replaced by something else. Still, in this instance, index.php had the higher PageRank, and that's something I didn't want to lose.
A similar situation may also apply to incoming links to specific pages. If you have more than one way of referring to these pages, make sure that incoming links only point to the page using one unique page identifier, i.e.
Both identify the same page, but may seen differently by search engines. Better that incoming links always point to one of these; for example, if one link has a PageRank of 2 and the other 0, the first stands a much better chance of ranking high in a search listing than if both have a PageRank of 1.
Best Search Engine Optimization practice, and best web design practice, is to have only one URL for each unique page.
PageRank dilution by outgoing links
Sites with outbound links are more popular with viewers. They have more credibility. They get return visitors. Review pages that reference but do not link frustate your visitors, and make them more likely to click away and not come back.
At the same time, outgoing links divert some of that page's PageRank to other sites; they dilute your own ranking. So what do you do?
Consider an average content page, with 20 menu links to 20 of your main pages. Assume the page's rank is 0.15. Without outgoing links, it contributes a PageRank increase of 0.85 x (0.15 ÷ 20) = 0.0064 to each of the 20 main pages, worth even less when the logarithm is applied.
Add two outgoing links to the content page. Now, the PageRank contributed back to each main page is 0.85 x (0.15 ÷ 22) = 0.0058. Difference: you've decreased the PageRank of each of your main pages by 0.0006 - less, after the logarithm is applied.
Of course, you do this for 1000 content pages, and you've diminished the base PageRank of your 20 main pages by 0.6 each; not so insignificant.
Worth the cost?
Again, you gain credibility. Users happy with being able to go from your site to others with quality content; users who'll bookmark you and come back. And some visitors - probably - who'll link to you.
Before I make recommendations, let's explore a few specific outgoing-link situations in more detail: reciprocal links, links pages, and use of the HREF rel="nofollow" tag.
Reciprocal links and their effect on PageRank
Reciprocal links are typically part of a negotiated link exchange, i.e., I'll link to you if you link to me. In general, reciprocal links are good, with some obvious provisos. Diverting some of your own PageRank to get an incoming link is worth it if the other site's PageRank contribution is higher than what you might lose. That is, if the remote site's Links page has a PR of 1, with 30 links on that site, your main page gains a PageRank of 0.03. (At most - for the logarithmic down-rating of PageRank, see the previous article in this series.) In return, if you give away less of your site's PageRank - you come out ahead.
If both sites give away approximately the same amount of PageRank as they gain, but you both gain traffic - you both win. Even competitors will often (but not always) gain more than they lose.
If you give away more PageRank than you get back, but you gain significant traffic - you win.
If, however, you exchange links with sites that are irrelevant to your main interests, that degrade your site's credibility, that give you little or no PageRank back in return - you lose.
Note that identifying sites for potential link exchanges, and them negotiating those exchanges, is time-consuming, and relatively low-yield. Frequently you get no response at all, and fairly often you'll get 'no.' Also note that, if these sites tag their outbound links with the rel="nofollow" tag, you gain no PageRank at all. More on this below.
The actual process of identifying potential link exchange partners, and the Netiquette involved in reciprocal linking, will be the subject of another article.
As an alternative to finding partners through Google, Yahoo, or other search engines, there are so-called Link Exchanges: directories of other sites looking to exchange links. These may facilitate to process, provided that the links you exchange are with quality sites meeting the criteria above. However, using "link farms" to exchange links only for the sake of the links will often result in black-listing or de-indexing by search engines. You lose, and lose, and lose. Don't link to irrelevant or low-quality content.
To help identify whether a page is worth pursuing, I've created a Web Site PageRank Assessment Worksheet, in Excel (which calculates the anticipated gain in PageRank) and in PDF (sorry, you'll have to do the math by hand, though it's not hard).