I was always against Paid Links but it was needed for existence in this huge network of websites.
Google has taken a proper step from its side since the growth of Yahoo and MSN Live Search has be substantial and the results were up to the mark too. The algorithms are altered when paid links are used and hence even websites without much content can come get descent SERPs.
Paid links should be allowed for websites with good content and the no follow tag can be used. The link could be used to drive targetted traffic and not to gain traffic.
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