Refugee Economies in Kenya

Alexander Betts, Naohiko Omata and Olivier Sterck

Refugee Studies Centre, University of Oxford, February 2018.


Drawing on qualitative and quantitative data collected in and around Kakuma refugee camps and Nairobi, this report examines variations in economic outcomes within the refugee population, and between refugee and host communities in Kenya in terms of livelihoods, living standards and subjective wellbeing. The data shows that:

  • Refugees are significantly less likely than Kenyans to have an economic activity, but refugee employment rates and income levels vary by location.
  • Refugees are not always worse off than local host communities and there is significant variation in living standards across contexts and nationalities. Living standards are on average higher in Nairobi than Kakuma.
  • Host communities report higher subjective wellbeing than refugees in all contexts.

The authors consider four sets of explanatory variables (regulation, networks, capital, and identity) and conclude that:

  • Restrictions on refugees’ freedom of movement and right to work constrain their economic opportunities relative to host communities.
  • Refugees’ networks are economically useful for accessing supply chains, remittances and social protection.
  • Access to finance and education are positively correlated with having an economic activity and higher earnings, while poor health is associated with lower income, poorer diet and lower life satisfaction.
  • Identity (gender, ethnicity, religion and social class) shapes refugees’ economic opportunities.


The authors find some evidence that the degree of perceived/actual economic contribution, and the distribution of costs/benefits among the host community, influence refugee-host relations. The authors highlight several implications for policymakers:

  • Even in a restrictive regulatory context, refugees engage in diverse economic activities and a range of interventions are available to promote economic participation.
  • Regulation of refugees’ economic participation may be interpreted and implemented differently in different local contexts.
  • Data offer opportunities to identify the mechanisms through which particular interventions may lead to particular outcomes, e.g. higher income levels among refugees are correlated with access to credit, education, and good health.
  • Refugees’ own networks are among the most important sources of protection and assistance for refugees, and should be routinely recognized, mapped, and supported.
  • The costs and benefits of hosting refugees may be unequally distributed among different parts of the host community, leading to varying attitudes towards refugees.
  • Refugees face different development outcomes due to differences in regulation, networks, capital, and identity. Advocacy, programming, and policy should focus on these areas to enhance economic outcomes, and improve relationships between refugees and hosts.
  • Every major refugee-hosting area should have an economic policy/strategy specifically for refugees and the immediate host community, based on robust analysis and consultation.