How does polarization affect the perfomance of a microwave link?

That the way the waveguide is placed with respect to the antenna, whether vertically of horizontally

Answer:
Absolutely. Of the two linear polarizations, if nothing else, vertical polarization is far less susceptible to rainfall attenuation than horizontal.

OTOH, horizontal polarization may give you less problems with multipath and may buy you an advantage in situations where you're not quite line of sight.

Last, having the two ends mismatched will kill about 20db of your signal strength. Definitely pick ONE!
Civil engineer by degree... Amateur Radio operator by hobby... I did some independent study for antenna design a few years back. I vaguely remember the answer to your question is yes. It would be difficult for me to go find the reference.

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