Mortality projections in Portugal

Abstract

Population forecasts are used for important policy decisions both in the public and private sector. Forecasts produced using the cohort-component method requires, for each cohort, a projection of the fertility, migration and mortality components. In this paper we describe the methodology used in the projection of the component mortality within the 2008 Portuguese Population Projections exercise. The methodology is based on a combination of extrapolative and expert-opinion based methods. Specifically, we use the Lee and Carter (1992) log-bilinear model and its extension by Brouhns et al. (2002) based on heteroskedastic Poisson error structures, together with a new variant of the model proposed by Bravo (2007) in which the Poisson-Lee-Carter framework includes a limit life table to which future mortality improvements converge. This allows us to explicitly consider expert judgment together within a statistical extrapolative model, which is important to ensure that forecasted values based on past trends in mortality are within biologically reasonable boundaries. Additionally, we describe the methodology used to close life tables at older ages. Finally, we give an example on how to use this model considering mortality scenarios concerning the future development of mortality generated by the Heligman-Pollard mortality law for the Portuguese female population.