guest blogging(natural way link building) will help you get do-follow link and traffic to ur blog. good do-follow back link and traffic will help u get good pr(google page rank) google PR will update in every 3-4 month.
PR links are as natural as any other recommended links are, provided you syndicate only genuine news. You don't push PR just for the sake of getting links. This technique has always been considered as spam, but we used to use it as Google was not so strict about such links. But now, Google has become really specific about unnatural links
Read this article and you would get a detailed answer to your question. http://searchenginewatch.com/articl....-Guest-Posting-Imagine-A-World-Without-Links . Guest blogging when done with a good purpose comes out well.
It is much harder to get good backlinks. If your competitors give up building backlinks, while you can insist, you will get good rank.