A theoretical study of supercontinuum generation in photonic crystal fiber and its application to pulse compression is presented. The evolution of the spectrum can be divided into three stages: initial broadening below a certain threshold propagation distance, dramatic broadening to a supercontinuum at a threshold distance, and, finally, saturation of the spectral width on propagation. It is found that the group delay and group-delay dispersion of the supercontinum are sensitive to the input pulse peak power after further propagation at the third stage. Fluctuations from the input pulse are amplified and translated into fluctuations and time shift of the compressed pulses. There exists an optimum compressed distance at which compressed pulses with negligible fluctuation and time shift can be obtained.
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