I am getting the distinct feeling based on traffic to my websites that clicks on particular entries in SERPs are being weighted more strongly in the Google algorithms. In other words, suppose you had a web page sitting at #3 position for a given keyword search. If this web page gets more clicks by searchers than the #1 or #2, then this will eventually move your web page to the #1 or #2 position.
The question has evoked similar sentiment and others feel the same way. Respree, for example, says that Google likes popular sites. Does that extend to click popularity?
Bill Slawski, on the other hand, thinks that other factors come into play: which page was clicked? How long has the visitor hung around? How much of the page do they view (do they scroll down?) Do they refine their query? Are they returning to the page, and if so, how?
There's a lot of discussion, but there's no real support to the method. It is possible that people might access the 4th result and give it enough link juice to hit the #1 position. However, there's no definitive answer, and Google would never tell us anyway. ;)
Forum discussion continues at Cre8asite Forums.