Every physical joint between two conductors has a small but non-zero contact resistance. When a connection is loose, the true metal-to-metal contact area shrinks, oxide films form, and the contact resistance rises sharply.

The heat generated at that joint follows Joule's law:

P = I² × R_contact

• Because the loss depends on the square of the current, high-current circuits are especially vulnerable — even a small contact resistance produces a large amount of heat.
• This localized heating at the joint can melt insulation, oxidise and further degrade the contact (a runaway effect), cause arcing, and ultimately start a fire.
• Regular tightening restores full metal contact, lowers R_contact, and keeps the I²R heating at the joint negligible.

Hence connections are tightened because loose connections cause localized heating and fire risk.

The other explanations do not follow from the physics: a tight joint does not lower the circuit voltage (the supply voltage is set by the source, not the joint), it has nothing to do with current reversal (direction is governed by the source polarity), and while poor connections can create noise, preventing electromagnetic interference is a minor side issue compared with the real hazard of overheating.