When formal institutions impede entrepreneurship: how and why refugees establish new ventures in the Dadaab refugee camps

For this paper we investigated refugee entrepreneurship in the Dadaab refugee camps, Kenya, a place where humanitarian aid practices and domestic legislation impede entrepreneurship, yet hundreds of new ventures have been established by refugees. The analysis finds that refugee camp entrepreneurs erode formal institutions, recombine conducive aspects of both formal and informal institutions, and exploit the advantages of institutional misalignment. We explain how entrepreneurs strategically maintain rather than overcome institutional misalignment for venture creation. Second, we show how self-determination, rather than mere subsistence or necessity, is an important yet often overlooked motivator for entrepreneurship in low and lower middle-income contexts.