@glenngould: Wikipedia is an interesting case, because an encyclopedia should be self-referential. Wikipedia generally does make an effort to link out to cited sources and official web site and additional outside information, at least, which is helpful.

Internal linking is not just about page views and keeping people on the site, imho. There is also the (alleged at least) search engine opt. effect of keeping “Google juice” or Page.Rank on your own site, and not let too much flow out. On the other hand, from a visitor’s perspective, a page with many outgoing links is often more useful, so probably search engines take that into account to some extent when ranking a page.
The HITS page ranking algorithm defines pages as authorities or hubs respectively, if they have lots of either incoming or outbound links. Both hubs and authorities are valuable in different aspects. A page that manages to be both a hub and an authority is especially valuable, imho. Authorities generally deserve a higher value though, since making a page a hub is quite easy.

The only cure for this phenomenon is for Google to actively punish the practice, and to publicly state that it will hurt rankings to do this.

If fact it is in their interest to do so because they rely on cross site link for a (large?) part of their ranking algorithms.