Characterization of between-group inequality of longevity in European Union countries

Abstract

Comparisons of differential survival by country are useful in many domains. In the area of public policy, they help policymakers and analysts assess how much various groups benefit from public programs, such as social security and health care. In financial markets and especially for actuaries, they are important for designing annuities and life insurance products. This paper presents a method for clustering information about differential mortality by country. The approach is then used to group mortality surfaces for European Union (EU) countries. The aim of this paper is to measure between-group inequality in mortality experience in EU countries through a range of mortality indicators. Additionally, the indicators permit the characterization of each group. It is important to take into account characteristics such as sex; therefore, this study differentiates between males and females in order to detect whether their patterns and characterizations are different. It is concluded that there are clear differences in mortality between the east and west of the EU that are more important than the traditional south–north division, with a significant disadvantage for Eastern Europe, and especially for males in Baltic countries. We find that the mortality indicators have evolved in all countries in such a way that the gap between groups has been maintained, both in terms of the differences in mortality levels and variability.