Fitting the Lee-Carter Model: A Statistical Approach to Mortality Forecasting

Author: Bhupendra Meena, Shivendra Pratap Singh, Anuj Kumar and Rahul Shukla

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Abstract

The study of mortality rates has a long history which has been used in the literature of fitting and forecasting. For Part-1, I have modelled mortality rates for 21 countries in Europe using the models: Lee Carter Model this model estimates parameters which contribute in calculating mortality. The dataset comprises available data from male and female aged 0-99 from the years 1985-2014. The comparison between the fitted mortality rates of the model and the actual mortality formula has been based on total mortality rate for each specific gender. This paper focuses on investigating the evaluation of this model based on different errors

Keywords

Mortality modelling, statistical analysis, Lee Carter Model, Fitting Errors

Conclusion

In recent years, significant research has focused on understanding complex systems, particularly social networks. These networks exhibit intricate community structures where individuals typically belong to groups or communities characterized by dense internal connections and loose external links. This arrangement creates a hierarchy of nested social ties.A key feature of statistical models used to analyze social networks is their capacity to directly represent the underlying mechanisms that generate dependencies between network connections. Mortality statistics serve as a valuable tool for assessing social relationships, with age composition playing a crucial role in shaping various social networks, including family, work, and friendship circles. Mortality significantly influences population dynamics and holds great importance in fields such as economics, demography, and social sciences. This thesis delves into various mortality models, examining their contributions to accurately fitting predicted values to observed mortality rates. Among the various stochastic mortality models available, the Lee-Carter model, introduced in 1992, stands out as the most widely adopted. Its popularity stems from two key advantages: firstly, it employs a relatively small number of parameters compared to alternative models, and secondly, it demonstrates notable robustness. These features contribute to its frequent use in mortality analysis and forecasting. Lee-Carter model remains a cornerstone in mortality forecasting due to its balance of simplicity and effectiveness. While it is not without limitations, its widespread use and continuous refinement attest to its enduring value. As demographic patterns continue to evolve, the Lee-Carter model and its extensions will likely play a crucial role in understanding and predicting mortality trends, thereby informing critical decisions in both public policy and private sector planning

References

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How to cite this article

Bhupendra Meena, Shivendra Pratap Singh, Anuj Kumar and Rahul Shukla (2024). Fitting the Lee-Carter Model: A Statistical Approach to Mortality Forecasting. Biological Forum – An International Journal, 16(8): 243-248.