Delivering Resilient Enterprises and Market Systems: Ethiopia

Executive Summary

The Delivering Resilient Enterprises and Market Systems (DREAMS) project is a multi-year initiative jointly implemented by Mercy Corps and Village Enterprise. DREAMS provides an innovative solution to promote self-reliance among refugees and host community members in areas with people living in protracted displacement by equipping them with financial skills, seed capital, and business opportunities that enable self-sufficiency and strengthen livelihoods. This report focuses on the DREAMS program implemented in Dollo Ado, Ethiopia.

DREAMS integrates poverty graduation (PG) and market systems development (MSD) to build self-reliance among vulnerable households. The 12-month PG component, implemented by Village Enterprise, equipped 10,800 participants in Dollo Ado with the skills, seed capital, and mentoring needed to launch businesses. Concurrently, the MSD component, led by Mercy Corps, strengthened local market ecosystems around priority value chains, notably shoat (sheep and goat) fattening, poultry, crop production, and fodder production. DREAMS’ core innovation lies in linking these approaches: the PG “push” makes participants market-ready, while the MSD “pull” connects them directly with Private Sector Actors (PSAs), such as input suppliers, local banks, veterinary clinics, and aggregators. These PSAs are meant to provide targeted training and input, and to act as reliable buyers, ensuring participants can successfully embed in local markets as profitable contributors.

This report describes the findings from the first endline of a rigorous impact evaluation of DREAMS in Ethiopia’s Dollo Ado region, assessing its short- to medium-term outcomes. IDinsight designed and conducted a multi-arm, household-level randomized controlled trial (RCT) to estimate the causal impact of the poverty graduation model in the context of indirect market systems development, as well as the full DREAMS program, on household economic productivity and welfare, perceived well-being, social cohesion, and women’s empowerment among refugee and host households. Eligible households across the study cohorts were randomly assigned with equal probability to one of three groups: the status quo (control group), the poverty graduation intervention (PG arm), or the complete intervention (full DREAMS or FD arm)[footnote]Market systems development is a community-level intervention. Some aspects of MSD programming – including market assessments and support for private sector actors (PSAs) – are not directed at specific households or individuals but may strengthen markets and affect outcomes in entire communities. Therefore, given that MSD was being implemented across all communities where the evaluation took place, we cannot say that PG and control households were unexposed to the effects of MSD. However the “direct MSD” components, such as value chain training, vouchers for value chain-specific inputs, and linkages to PSAs, are targeted at individuals and can be randomized.[/footnote]. Participants in the PG arm joined business savings groups (BSGs) and business groups (BGs), received the full set of training on business selection, financial management, savings, and other business topics, and received seed capital in two tranches. Participants in the FD arm received all PG components, in addition to value chain–specific support, including smart subsidies related to the promoted value chains, targeted technical training, and direct linkages to PSAs operating within those value chains. The endline data were collected between October and December 2025, capturing outcomes approximately 6 months to 1.5 years after implementation. The final study sample consisted of 6,151 households (2,047 control, 2,054 PG, and 2,050 FD). Because indirect MSD activities operate at the community level, all study groups were exposed to its effects; the PG vs. control contrast captures the effect of PG in the context of indirect MSD, and the FD vs. PG contrast captures the incremental effect of adding direct market linkages.

Read the full report from the first endline here