Transient radio signals of astrophysical origin present an avenue for studying the dynamic universe. With the next generation of radio interferometers being planned and built, there is great potential for detecting and studying large samples of radio transients. Currently-used image-based techniques for detecting radio sources have not been demonstrated to be optimal, and there is a need for development of more sophisticated algorithms, and methodology for comparing different detection techniques. A visibility-space detector benefits from our good understanding of visibility-space noise properties, and does not suffer from the image artifacts and need for deconvolution in image-space detectors. In this paper, we propose a method for designing optimal source detectors using visibility data, building on statistical decision theory. The approach is substantially different to conventional radio astronomy source detection. Optimal detection requires an accurate model for the data, and we present a realistic model for the likelihood function of radio interferometric data, including the effects of calibration, signal confusion and atmospheric phase fluctuations. As part of this process, we derive fundamental limits on the calibration of an interferometric array, including the case where many relatively weak "in-beam" calibrators are used. These limits are then applied, along with a model for atmospheric phase fluctuations, to determine the limits on measuring source position, flux density and spectral index, in the general case. We then present an optimal visibility-space detector using realistic models for an interferometer.Comment: 45 pages, 4 figures, accepted for publication in the Astrophysical Journa
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