Foreign Direct Investment and Public Revenue in Nigeria

Developing countries of the world have come to recognised Foreign Direct Investment (FDI) as an alternative supplement to deficit supply of savings and capital. These countries have always make efforts to attract FDI into their economies using available economic policy tools. This research has examined the nexus between FDI and Public revenue in Nigeria bearing in mind the periods 1981 and 2021. The research used the Toda Yamamoto approach to causality and the findings revealed that, capital expenditure, public revenue and tax revenue are important tools in attracting the inflow of FDI in Nigeria. Furthermore, the research also found that FDI in Nigeria is an important contributor to non–oil revenue. This research recommended a viable use of public finance tools to lure FDI into the country as well as the strengthening of fiscal policy institutions for ensuring the manifestation of FDI feedback effect on public revenue.