This is widely discussed and widely used link exchange program.
Reciprocal linking means two websites targets each other, giving backlink in exchange of the same.
Many bloggers and webmasters are using reciprocal linking to increase number of backlinks and hence link popularity.
But the question is

1. How much this method is effective?
2. Is it is pure white hat seo technique?
3. Does too much Reciprocal links harms your seo?

In nature, it is natural and points to relative information pages.
That's why the effect of reciprocal link building is depends on how you use it.
It is okay if you use it to point similar kind of content to serve your readers interest, and number of total links are adequate.
Here I mean to say that, This SEO Technique is useful for human readers but too much of it on same page may become unnatural for readers.
It is not OK if you are using it only to improve your link popularity, increasing number of backlinks, and linking wide range of urls without their relativeness of content.
It is not OK if you are linking naturally and very relative content, but the number of links are too much.
If you are very concerned about backlinks and want to improve your link popularity, i will recommend to use other link building methods like forum posting and blog commenting and not to use the reciprocal linking for it.
What ever you do in SEO, i strongly recommend you to stick to the genuine and natural methods that is say white hat SEO techniques.