Statistical comparison of projection Malaysia mortality rate by using Lee-Carter model and Lee-Carter extension of Hyndman-Ullah

Abstract

Study of human mortality pattern is a significant area for any nation to maintain a good social-economy in the next projection decades. The declining in mortality trend gives a good impression of what the nation has done towards macro citizen in one nation. Selection of mortality tool can be complex based on the method and analysis approach adapted. Lee-Carter model is adapted because of its simplicity and reliability of the outcome results. Implementation of Lee-Carter in finding a fitting 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 using original model of Lee-Carter and its extension of Hyndman-Ullah. 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 modeling results are modeled using Rstudio and the keen analysis can be focus on Malaysia’s social-economics and insurance related aspect. This paper can be extended to another variety of Lee-Carter extensions and any stochastic mortality tools by using same mortality data.