The peak-to-average power ratio (PAPR), commonly used to describe the amplitude variations of an OFDM (orthogonal frequency-division multiplex) signal, does not accurately reflect its impact on the system performance. This paper applies the mutual information as a metric to assess the effects of nonlinear PAPR reduction schemes on the performance of OFDM systems. Evaluation of the achieved mutual information shows that a significant capacity loss from clipping occurs only at high SNR (signal-to-noise ratio) and a simple compression/expansion technique is proposed to achieve close to optimal performance in this regime. The effectiveness of this method is validated through WER (word error rate) simulations with several modulation and coding schemes.
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