Sure, many would not have any problem with linking out to related blogs, but from an SEO perspective many bloggers are holded back by two main outbound linking concerns, namely:

1. fear of not loosing PageRank; some see outbound links as PR self bankruptcy. Of, course there is some PageRank passed to the referenced blog, but an SEO open policy that gratifies all quality informational source in your niche is beneficial for your credibity with the search engine.

On the other hand an iron courtain where you don’t assign any editorial trust to blogs that serve your readers isn’t quite endorsed by SEs.

The reason is simple: ranking factors such as PR are established for good content to be promoted to make the SERPs more relevant; they are not intended be sculpted upon for personal benefits only.

2. having to deal with a flood of reciprocal links (as a returned favor); many consider this as being a bad thing. First of all, reciprocal linking is bad when conducted with partner sites involved in shady activities like link farming or they just simply not related with your niche (this counts only when practiced in large numbers). Yes, the ranking power of an reciprocoal link is diminished as compared with one way links but they still count. There are also other benefits that can be extracted from the above post.

Hope this helps inprove your SEO perspective!

Cheers,
Cristian