lukeROB
Contributor
ssra30:Like all that Alcina said, basically RAW file recorded everything from the sensor in 16 bits and write it uncompressed to the card so you can get maximum data for the picture. Resolution does not really change between RAW and JPEG. However this is not true of Nikon RAW file from current Nikon such as D70 which is 12 bits compressed (eventhough Nikon clamined that its compression is lossless, whatever that is).
Most RAW files would use some form of lossless compression. It would seem silly to save a larger file for no reason. Also most RAW files are 12bit - reason being the sensors are usually 12bit - I know the canon compacts are the same. There are I'm sure 16bit sensors around though. A lossless compression is something like a .zip file. All information is retained however file size is decreased. This is done through mathematical formulas which allow certain data to not be saved because this data is retained from the knowledge about other parts of the data. A very simple example is in a black and white image, you only have to save the information about black pixels, the compressed file when opening knows that if the pixel has not been marked then it must be white. Simple and in a perfectly half/half black white image you have applied a lossless compression to achieve a file size 50% smaller. Colour standard images are more complex and so compression is not really that great but you get the idea.
The real advantage of RAW is in post processing as the others have said. Think of it this way. A RAW file allows you to apply software filters to the image with the raw information recorded by the sensor. You can control what the software does opposed to the camera selecting and doing it for you. Since in camera software is basically fixed once manufactured and it must fit in small amounts of memory it is never going to be as good as external software. This external software can change and be built on and as it improves so you will be able to apply more sophisticated filters to your image. RAW is often thought of as a 'digital negative' because of this. All files start out as RAW but you are deciding whether your camera makes standard decisions to produce an image or whether you control the decisions to be made.
Sorry this is badly written and confusing but I thought I would just write it down as it was coming into my head. I might do a better job when I'm not so tired so if it isn't understandable just let me know and I'll try explain it better.