Forecasting selected specific age mortality rate of Malaysia by using Lee-Carter model

Abstract

Observing mortality pattern and trend is an important subject for any country to maintain a good social-economy in the next projection years. The declining in mortality trend gives a good impression of what a government has done towards macro citizen in one nation. Selecting a particular mortality model can be a tricky based on the approached method adapting. Lee-Carter model is adapted because of its simplicity and reliability of the outcome results with approach of regression. Implementation of Lee-Carter in finding a fitted model and hence its projection has been used worldwide in most of mortality research in developed countries. This paper studies the mortality pattern of Malaysia in the past by using original model of Lee-Carter (1992) and hence its cross-sectional observation for a single age. The data is indexed by age of death and year of death from 1984 to 2012, in which are supplied by Department of Statistics Malaysia. The results are modelled by using RStudio and the keen analysis will focus on the trend and projection of mortality rate and age specific mortality rate in the future. This paper can be extended to different variants extensions of Lee-Carter or any stochastic mortality tool by using Malaysia mortality experience as a centre of the main issue.