A more meaningful parameterization of the Lee–Carter model

Piet de Jong*, Leonie Tickle, Jianhui Xu

*Corresponding author for this work

Research output: Contribution to journalArticlepeer-review

3 Citations (Scopus)
62 Downloads (Pure)


A new Lee–Carter model parameterization is introduced with two advantages. First, the Lee–Carter parameters are normalized such that they have a direct and intuitive interpretation, comparable across populations. Second, the model is stated in terms of the “needed-exposure” (NE). The NE is the number required in order to get one expected death and is closely related to the “needed-to-treat” measure used to communicate risks and benefits of medical treatments. In the new parameterization, time parameters are directly interpretable as an overall across-age NE. Age parameters are interpretable as age-specific elasticities: percentage changes in the NE at a particular age in response to a percent change in the overall NE. A similar approach can be used to confer interpretability on parameters of other mortality models.

Original languageEnglish
Pages (from-to)1-8
Number of pages8
JournalInsurance: Mathematics and Economics
Publication statusPublished - 1 Sept 2020

Bibliographical note

Copyright 2020 The Author(s). Published by Elsevier B.V. Version archived for private and non-commercial use with the permission of the author/s and according to publisher conditions. For further rights please contact the publisher.


  • Age-specific elasticities
  • Age–response
  • Lee–Carter
  • Mortality
  • Needed-exposure


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