Delivering Resilient Enterprises and Market Systems (DREAMS) – Impact Evaluations

Decision Maker’s Challenge

For decades, the global response to refugee crises has focused on meeting urgent needs—providing food, water, and shelter. Yet displacement is increasingly long-term, leaving many refugees in camps for years with limited opportunities to earn income or rebuild their lives. As displacement becomes more protracted, many refugees spend formative stages of their lives in camps, raising concerns about the long-term and intergenerational consequences of limited economic opportunity.

At the same time, humanitarian funding is declining globally, placing additional strain on an already overstretched system. As resources dwindle, it has become increasingly clear that traditional humanitarian responses cannot sustainably support displaced populations indefinitely. This raises a critical question for humanitarian leaders: how can programs move beyond short-term aid to support sustainable livelihoods for displaced populations?

Ethiopia and Uganda host two of the three largest refugee populations in Africa, with approximately 1.1 million refugees in Ethiopia and 1.8 million in Uganda. As displacement grows while humanitarian funding declines, governments and donors need evidence on approaches that enable refugees and host communities to generate income and strengthen local economies.

The Delivering Resilient Enterprises and Market Systems (DREAMS) consortium, led by Village Enterprise, Mercy Corps, and IDinsight, tests whether combining poverty graduation with market systems development can help refugees and host communities build sustainable livelihoods in areas with fragile or thin markets. The program provides participants with business and financial training, mentorship, and market opportunities designed to support economic self-sufficiency. IDinsight is evaluating DREAMS in two refugee settings, West Nile in Uganda and Dollo Ado in Ethiopia.

Impact Opportunity

DREAMS tests a model that pairs household-level business support with efforts to strengthen local market systems, helping participants start businesses while also improving access to suppliers, buyers, and productive value chains. 

If successful, this approach could transform how refugee livelihood programs are designed and scaled, offering a pathway for displaced households to sustain themselves and contribute economically to the communities where they live.

Evaluating the DREAMS Program

We are conducting two large-scale randomized controlled trials (RCTs) in refugee settlements in West Nile (Uganda) and Dollo Ado (Ethiopia) to rigorously evaluate the DREAMS program. Each study uses a mixed-methods design, combining a household-level RCT with qualitative research to understand both the program’s impact and the mechanisms driving those outcomes. 

The evaluation focuses on three key questions:

1. What is the impact of DREAMS on the livelihoods, social cohesion, and perceived well-being of vulnerable refugee and host community households in West Nile and Dollo Ado refugee settlements?
2. What is the cost-effectiveness of DREAMS compared to the status quo?
3. [In Ethiopia only] What is the relative impact of DREAMS with and without direct market linkages, including input subsidies and value chain-specific support?

The evaluation includes two endlines: the first measures short-to medium-term impacts 1-1.5 years after implementation, and the second measures long-term outcomes 2-2.5 years after implementation.

Key Results

Uganda Endline 1

The DREAMS program had statistically significant impacts on all economic welfare outcomes at the 1% level. Including:

1. Higher Consumption: Treatment respondents reported USD 19.10 (69,205 UGX) higher average monthly household consumption than control households, representing a 17.1% difference.

Figure 1. shows the Household Monthly Consumption (USD) for the full sample, and disaggregated by host and refugee households

2. Greater Asset Ownership: Treatment households on average reported USD 184.10 (655,042 UGX) more in total asset value than control households, representing a 21% difference.

3. Higher Household Income: Treatment households on average reported USD 8.35 (30,199 UGX) more in total monthly income than control households, representing a 24% difference.

4. Higher Savings: Treatment households reported USD 27.01 (97,776 UGX) more in total household savings than control households, representing a 108% difference.

5. Lower Food Insecurity – Treatment households scored 0.23 points (0.10 SD) lower on the USAID Household Hunger Scale

6. Higher Overall Well-being – Treatment households reported higher life satisfaction, happiness, and perceived financial security, equivalent to a 12% (0.33 SD) increase on a 10-point index.

7. Higher Women’s Empowerment – Female treatment respondents scored 0.06 points higher (0.54 SD) on the empowerment index

Figure 2. shows treatment effects in terms of standardized effect sizes. Standardized effect sizes allow us to compare the magnitude of effect sizes across outcomes with different units of measurement.

8. Cost-effectiveness: If effects are sustained for five years, the DREAMS program will yield 2 times the value of its costs through increased household consumption and asset accumulation. In host communities, the short-run benefits already exceed program costs, whereas it takes three years for the program to break even for refugees.

Figure 3. compares the Return on Investment (ROI) for refugee vs host communities