Abstract

Despite a sustained increase in foreign direct investment inflows into Côte d’Ivoire, tax revenues have not exhibited a commensurate upward trend, raising questions about the effective fiscal contribution of foreign investment. This study examines the relationship between foreign direct investment (FDI) and tax revenue mobilization in Côte d’Ivoire over 1980–2023. It employs an ARDL model, structural break analysis, unit root tests, cointegration, and time-varying Granger causality. The results reveal a positive but modest contribution of FDI to tax revenue and confirm a government’s intertemporal trade-off. They also highlight a bidirectional causality. These findings offer valuable insights for policymakers seeking to improve tax revenue collection and support domestic resource mobilization.

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