Hmmm... this almost seems like to simple of a question? You really don't understand how paying people to click on links on ads - which go to your site - or landing page - increases traffic?
If i take you to mean more long term traffic you have a very valid question. PPC - is NOT a very good technique for general awareness and long term traffic building. It is very "burstly" - and will produce alot of traffic for a short period of time. It can cost you alot of money to product that "burst" - and you may or may not get users or customers who will stay.
PPC is, IMHO - most effective for ecommerce type sites - that can take the time to very gradually test and refine keyword, bidding, and landing pages - to track all the way through to and manage conversions in a sale. Then you can make it cost effective - if the customer has a good lifetime value to you and comes back.
it CAN also be used in Affiliate Marketing - to drive targeted traffic to specific offers and earn a bounty. This is not easy - and you cant just jump in and expect results - you have to be prepared to study, work, and compete in a niche - there are many people doing it so it is not an easy game.
Be careful not to allocate much $$$ to PPC until you have learned on a small budget first - or you will just see your money go down the old tube.
Unsolved 
