>This discusses how rather than why.
>How does reindexing affect performance ?

I've never really seen it improve performance to reindex as long as everything's working fine, but that's me. I'm sure there are folks who have.

However, I have seen indexes get corrupted - one symptom of this is after adding a record to a table, it doesn't seem to be there. Reindexing periodically can help stem off some of these problems.

I know a lot of developers that don't reindex until there's been a problem like this.
I know a lot that reindex regularly - once a week, 2 weeks, etc. depending on the amount of activity in the database.

The biggest factor is probably the amount of time it would take. Depending on the amount of data and number of indexes, it could take a while - so the system would have to be down while this maintenance is going on.

My .02
It couldn't hurt, and it would probably help.