The Polarization Index, developed by Sabavala, Morrison and Kalwani (1977), is a well-known measure of behavioral loyalty. It is of considerable use in analyzing purchase data and repeated choice revealed preference data. Until now, it has only been possible to evaluate the accuracy of estimates or polarization through simulations. We present a closed form estimator of its asymptotic standard error. Using simulations, we show that this estimator is sufficiently accurate for the typical sample sizes used in marketing studies.
LAURENT, G., RUNGIE, C., BROWN, B. and RUDRAPATNA, S. (2005). A Standard Error Estimator for the Polarization Index: Assessing the Measurement Error in One Approach to the Analysis of Loyalty. Marketing Bulletin, 16(Technical Note 2).