The Change-point Analysis of Swedish Mortality: Relevance of the Death Time and Time of Pension Payments
Authors:   Asia-Europe Perspective Association, Seo Youngsoo 
Published: June 2018

Fundamentally, pension has the aim to protect the insured and their families living. If the time of pension payments is determined with respect to the death of the subscriber, it would be helpful to establish economic stability in retirement. This study examines the relevance of the time of pension payments by analyzing changes in the mortality of Sweden known as the welfare state, measured from 1951 to 2005. I use the Bayesian Poisson multiple change-points model proposed by Kim and Cheon(2010), utilizing a Metropolis-Hastings algorithm. The empirical results draw the following implications. First of all, the number of deaths is reduced each year in both men and women, but differed by age. That is, the number of deaths in both men and women is slightly changed by 50-year-old, but after the age of 60 its variation is very wide. In particular at the age of 60 and 70, while females show a steady decrease in the number of deaths, males are significantly increased until 1980 and decreased sharply. Second, in the case of women, the number of deaths increases after the age of 30 until 1985, but after 1985 young people between 30 and 40 ages show an increase of the number of deaths. On the other hand, the analysis by age shows an acceleration of a women’s aging-oriented society since 2000. Third, in the case of men, like women the mortality rate of young people increases. This means that an aging is the whole community issue, but the premature death of young people should be now reflected as the important factor of the pension policy.
This study proposes two suggestions. First, I hope that the results of this study are applied to the pension policy of Korea. Korea’s leading pensions such as national pension, retirement pension and private pension determine typically the payment of pensions, regardless of the timing of death. Thus, as I see the case of Sweden, if times of pension payments and death are very different, it may have a bad influence to secure economic stability in old age. The second suggestion is the change of thought about the pension reform. The Swedish pension reform is worth enough to be introduced because it is the best model of the welfare state. Sweden is the first nation integrated under a single pension system and a country on the lead in implementing the principles of social security as institutional. Sweden advocates a structural reform rather than gradual reform by accepting the aging of the population and the slow growth of the economy as truly a reality, and seeking the best alternatives. The reality of Korea has clearly very difficult situations, which are a rapid increase of aging population, a steady decline of the labor force due to the decrease of the birth rate, and a stagnant swamp of the slow growth and a potential growth slowdown due to increasing the uncertainty of the external environment. Nevertheless, the reform of a Korean pension system is the biggest concern no longer be postponed. Therefore this study is need to find suggestion with analysis of korean mortality and swedish mortality by year and age simultaneously in future. Also this study is need to analyze the time of pension payments beside mortality systematically including various factor that is economic and non-economic factor that is increase of aging population, decrease of the birth rate.