Error Models for Official Mortality Forecasts

The Office of the Actuary, U.S. Social Security Administration, produces alternative forecasts of mortality to reflect uncertainty about the future. Appropriate probabilistic interpretations of the intervals have not been provided, however, because explicit stochastic models are not used. In this ar...

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Bibliographic Details
Published in:Journal of the American Statistical Association 1990-09, Vol.85 (411), p.609-616
Main Authors: Alho, Juha M., Spencer, Bruce D.
Format: Article
Language:English
Subjects:
Actuarial science
Americas
Analytical forecasting
Applications
Applications and Case Studies
Brownian motion
Cause of death
Causes of death
Demography
Developed Countries
Evaluation Studies as Topic
Exact sciences and technology
Expert opinion
Forecasting
Heart diseases
Mathematics
Models, Theoretical
Mortality
Mortality rates
Musical intervals
North America
Population
Population Characteristics
Population Dynamics
Population projections
Preliminary estimates
Probability
Probability and statistics
Research Design
Sciences and techniques of general use
Sex Factors
Social security
Standard deviation
Statistics
Statistics as Topic
United States
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Summary:The Office of the Actuary, U.S. Social Security Administration, produces alternative forecasts of mortality to reflect uncertainty about the future. Appropriate probabilistic interpretations of the intervals have not been provided, however, because explicit stochastic models are not used. In this article we identify the components and assumptions of the official forecasts and approximate them by stochastic parametric models. We estimate parameters of the models from past data, derive statistical intervals for the forecasts, and compare them with the official high-low intervals. We use the models to evaluate the forecasts rather than to develop different predictions of the future. Analysis of data from 1972 to 1985 shows that the official intervals for mortality forecasts for males or females aged 45-70 have approximately a 95% chance of including the true mortality rate in any year. For other ages the chances are much less than 95%. The Office of the Actuary's interval estimates of age- and cause-specific mortality for males and females have no consistent probabilistic interpretation. The ranges are too large for some diseases and too small for others.
ISSN:0162-1459
1537-274X
DOI:10.1080/01621459.1990.10474917