Role of Probability Theory in Statistics

Role of Probability Theory in Statistics

Statistics and Probability theory are all about things that are not really certain. Probability Theory is the attempt to extract knowledge about what event has happened or will happen in the presence of this uncertainty. Apart from the earliest application of probability in gambling, numerous other exist : in Science, where we make experiment and interpret them ; in Finance ; in Insurance and in weather reports etc. In real life we do not have the probabilities, we have the data. And so we want tools that allow us to estimate the probabilities from the given data. This is what statistics is about. In most of the academic discipline research area; it is the data we have and we want to know about probabilities.
 
Statistics is the art of guessing the model and its parameters. It is based on probability theory. In most of the scientific research probability theory underlines statistical inference. Statistical inference involve making generalization or inferences about unknown population parameters. The concept of probability theory allows us to have better understanding of statistical inference and to quantity the strength or confidence in our conclusion.