The Refugee Camp Economy and the Economic Argument for Re-Conceptualizing Camps as Permanent Cities

Though the European Migrant Crisis has refocused Western attention toward the plight of the refugee, the issue of how a host country should deal with incoming refugees is not new. Many host countries choose to house refugees in camps, or designated areas often prepared in haste for the temporary housing of incoming refugees. However, these camps tend to exist longer than initially anticipated, and eventually begin to resemble makeshift cities, sometimes with tens of thousands of inhabitants living in a given area for an extended period of time. In time, a local economy begins to take form, and while the refugee camp economy is currently rather under researched, what economic and ethnographic research that has been done reveals key economic inefficiencies in the way camps are constructed.

In a few ways, the refugee camp economy functions much like one might expect. The primary economic actors tend to be the inhabitants themselves (as opposed to local citizens of the host country), many of whom come into the camp with previously developed productive skills and some even with access to valuable commercial networks or even financial capital back home. That being said, there are no large corporate businesses, and instead most commerce is conducted through either small specialized shops in designated market districts, or generated via the refugees’ agricultural production.

Perhaps surprisingly, there are often benefits to living and working in these camps as well. The 1951 Refugee Convention requires that taxes and tariffs levied on refugees may not be higher than the level that nationals of the same tax category pay, though often refugees do not pay taxes at all, or pay lower taxes than citizens of their host country. For example, Afghan refugee truckers working in Pakistan are exempted from licensing fees that Pakistani truckers must pay. Likewise, asylum seekers coming to Nakivale (Uganda) receive a plot of land with which to start a farm for free upon arrival. It seems from these observations that host countries generally recognize that there is typically little revenue to gain from refugees, and that refugees can typically contribute more to a country’s overall economic well-being as cheap labor than as direct revenue sources.

However, the economic costs associated with living and working in a refugee camp tend to offset or even overshadow the small benefits enjoyed by refugee workers. The most fundamental of these costs is the restrictions on movement outside of the camps. In order to travel outside of a given camp, refugees are almost always required to possess a permit issued by a settlement commander. These permits, though often in high demand, are not always easy to obtain. Werker (2007) notes that in the Ugandan camp in Kyangwali, the commander only issues permits on “one or two scheduled days each week.” Though these permits are generally free, they are issued at the commander’s discretion, exposing the permit allocation process to favoritism, prejudice, or even outright corruption.

This makes it difficult to conduct trade as a refugee. First, there are significant time costs involved, even if you know exactly when you will need the permit and when to see the commander, as the refugee must travel to the commander’s office and wait for however long it takes to see the commander, a process that the refugee must set aside at least a half of a day to complete. In addition, the refugee must have the foresight to plan ahead when exactly they will require access to an outside market, and then hope that they will be able to obtain the needed documentation when they expect to need it. Because of these high transaction costs associated with doing business with the outside world, a refugee is incentivized to start a business that caters to the needs of those inside the settlement. This means that refugee entrepreneurs are limited to maintaining small shops or general stores inside the camp itself, limiting themselves to smaller market sizes and lower growth potential.

Additionally, refugees face restrictions on their ability to work outside the camps, in addition to restrictions on their ability to leave the camp. Typically, in order to work outside of the refugee camp, refugees must get a work permit from the national visa office in the host country’s capital. This permit is difficult to obtain because of both time and monetary costs associated with obtaining the visa. In terms of monetary costs, the refugee must pay for transportation to the host country’s capital and back, and pay administration costs for the work permit itself. All-together, for the refugees living in the Kyangwali camp in rural Uganda, it costs more than a season’s worth of agricultural revenue just to make the journey to Kampala (which itself does not guarantee the permit), and around 6.5 times as much as the average season’s agricultural revenue to cover administration costs, which is “prohibitively expensive” for many refugees to obtain. With respect to time costs, the refugee must obtain a permit to leave the camp, travel to the host nation’s capital, jump through all the hoops associated with obtaining the work permit, and return to the camp before the permit to leave the camp expires. One mistake could throw off the timing of the delicately constructed journey, jeopardizing the refugee’s ability to make it back to the camp on time. The complexity and financial infeasibility of the process of obtaining a work visa discourages refugees from working outside the camp, even if the job opportunities within the camp limit the refugee’s ability to realize their full earning potential. Though specific details concerning its nature have not been recorded, similar restrictions to refugees’ movement (either by law or economics) have been reported in Zaatari (Jordan) and Calais (France), indicating that the Kyanwali account is not unique.

In addition to limiting one’s ability to work, barriers on easy movement present at many refugee camps (as well as the physical distance from the host nation’s population centers found at some of the more rural camps) contribute to unreasonably high information costs concerning economic activity in the outside world. In refugee camps, there tends to be little to no up to date information for refugee businesses concerning prices, new suppliers, best fertilizers, who is selling what crop, etc. This is particularly detrimental to farmers, and appears to at least partially explain why farmers in the Nakivale (Uganda) tend to grow maize more often than not, even when other crops have reportedly brought in seven times as much revenue in markets nearby, but outside of, Nakivale. Obviously this puts refugee businesses at a disadvantage and, much like how restrictions on work limit a refugee worker’s earning potential, the lack of up to date information limits the growth potential of refugee businesses.

Additionally, the extreme isolation, maintained in part by restrictions on movement, creates an environment that is ripe for predatory pricing on behalf of host country nationals doing business with refugees. The isolation of the camp means that the camp receives relatively few external traders selling goods to the refugees and buying the refugees’ agricultural products. Even if the external traders do not explicitly collude in a collective effort to cheat the refugees, the nature of this kind of oligarchic market sustains unfair prices for longer periods than in the more competitive markets that exist outside of the refugee camp.

Likewise, the isolation of camp, either as a product of sheer distance or by movement restrictions imposed on refugees, limits the market size and complexity available to refugees. As a business, this limits one’s growth and diversification potential, as it forces the business to cater to the demand of the camp exclusively, as opposed to being able to diversify to the demands of the camp and several other local markets in the region. As a laborer, the lack of diverse employment options limit’s one earning potential, as it becomes increasingly difficult to find employment that best matches one’s particular set of skills as the total market size of the camp, and subsequently the total amount of employers, decreases.

In fact, we see again and again that the status quo of refugee camps imposing strict constraints on refugees’ ability to move and work outside the camp yields economic inefficiencies (without mentioning, of course, the potentially unlawful nature of such restrictions). Naturally, one may wonder why host countries adopt these restraints on refugee movement and work in the first place. The obvious explanation is that there are security concerns with allowing refugees to move freely around a host country. Concerns over security are certainly legitimate, and can justifiably supersede concerns about economic inefficiency. Less justifiably, but certainly realistically, it would be difficult to doubt that there is a prejudicial tendency on behalf of the host country to want to keep refugees confined to certain areas, and that sometimes these prejudices can overshadow one’s better judgment.

Additionally however, restrictions on movement and work are put in place because the refugee camp is intended to provide temporary asylum from immediate danger. They are often built in haste and grow in an ad-hoc manner, as tents are pitched the day they are needed. This lack of long term planning and emphasis on temporary solutions indicates that there exists a conception that refugee camps are merely interim working and living arrangements meant to exist after the refugee has fled their home country, and before they return. Therefore, the host country is not looking to assimilate refugees into their economy, but merely support them for a few years before they leave. Restrictions on work and movement become comprehendible policies, as this makes it difficult for refugees to root themselves in their host country long term.

In the face of this observation, it becomes clear that in order to make it easier justify lifting barriers to movement and work, and realize the economic gains to be had from a large population of laborers with diverse skills, it would behoove host countries to re-conceptualize refugee camps as permanent refuge cities instead of mere spaces of temporary asylum. At first take, this idea of accepting the permanent nature of these refugee settlements explicitly undermines any hope that refugees or host countries may have of the refugees returning to the life that they once had. The ideal narrative of refugees coming to a camp to wait out a conflict in their home country until it is safe to return, is only a valid conception of the situation if it is understood that the camps, and the circumstances that drive refugees into the camps, are ultimately temporary. For the refugees themselves, framing life in a refugee camp as ultimately temporary implies an eventual return to normality, fueling a feeling of hope that is doubtlessly valuable at such a difficult time.

But this narrative has been deemed incompatible with reality by recent history. By UNHCR estimates as of 2003, the average amount of time spent in “protracted refugee situations” (i.e., refugee situations including, but not limited to, living in refugee camps) is 17 years. This explicitly undermines the narrative that refugees only need asylum for a few years while they wait out danger. In reality, refugees who come to refugee camps (or choose to formally migrate to other countries altogether) should be seen as individuals who are, more often than not, there to stay.

And once this idea of permanence is accepted, the host country is in a better position to lift the restrictions of movement and work currently imposed on migrant communities. If one believes that refugees are only in a host country for a couple years to wait out a conflict, it is easier to accept the inefficiencies associated with limiting the growth potential of refugee businesses, constricting the earning potential of refugee laborers, subjecting refugees to unfair trading dynamics, and lack of access to information. If it is accepted that the refugees will be in a given camp for an average of 17 years, the economic inefficiencies derived from restrictions on movement and work become glaring, as the host country is essentially giving up a generation of lost productivity. It becomes obvious that both the individual refugee and the host country’s economy stand to gain from the refugee’s free movement and ability to work.

Unfortunately, empirically estimating the economic effects of these restrictions on movement and work has proven difficult, and much of the academic work concerning refugee camp economies has been founded upon direct observation and the application of general economic principles. Likewise, no refugee camp has officially been designated as a permanent city or area of asylum, denying the opportunity for a natural experiment. This lack of empirical work leaves room for further exploration as to the magnitude of the claims made in this article.

What is no longer up for debate however, is whether refugee camps should be seen as temporary housing, or as permanent cities with citizens able and willing to contribute to the host country’s economy. What the persistent metropolis’ of Dadaab and Nakivale make clear is that camps tend to stay open much longer than intended, and are better thought of as permanent fixtures in their regions rather than temporary anomalies. Considering this fact, it simply makes sense to re-conceptualize refugee camps as cities, and to lift the economically unnecessary restrictions on work and movement currently imposed on the inhabitants of these cities. At the very least—perhaps if security concerns render this solution improbable—it must be recognized that current restrictions on movement and work that refugees face in camps is economically inefficient, and that finding a way of easing these restrictions would improve the welfare of the individual refugee and host country concurrently.

Of course, basic asylum for refugees fleeing immediate danger should remain the priority, and capturing the economic gains from these refugees should be of second order to this immediate need for safety. But acknowledging that there is a hierarchy of priority when dealing with refugee camps does not preclude realizing second order goals entirely. This is not about shifting the focus from providing asylum for people in need to turning desperate people into economic gains. Rather, it is about capturing what is already there.

The Tragedy of NGOs: A Faustian Perspective on Human Rights Activism

I feel as if I’d drummed into my brain
the wealth of human knowledge all in vain.
I finally stand back, only to find
no new-born power rising in my mind.
Not one hair’s breadth is added to my height,
nor am I any nearer to the Infinite.
—Johann Wolfgang von Goethe, Faust

International relations (IR) is typically considered a social science, but it can learn a lot from thinking poetically. Here, I strive to adopt a lesson from poetry in order to explain some of the actions and criticisms of transnational human rights non-governmental organizations (NGOs).

According to German folklore, the philosopher-scientist Faust exasperatedly sells his soul to the devil as his attempts to discover the universe’s truths fail to reveal any deeper meaning in his scholasticism. The deal gives Faust limitless knowledge and worldly pleasures. In early versions of the legend, Faust delves into a life of sin with the devil as his servant only to discover that, at the end of their agreement, he has been irrevocably corrupted, and is dragged to hell. The legend is meant to metaphorize those who sacrifice their principles for their ambitions.

IR, along with other social sciences, asks why questions that determine causal mechanisms and how questions focused on constitutive explanations, to borrow from Alexander Wendt’s phrasing in Social Theory of International Politics. In that sense, I ask how the moral authority for human rights activism is constructed by NGOs and how their theoretical critics reinterpret such supposed moral authority. I argue that such organizations are best understood through a Faustian perspective. NGOs balance concerns over adhering to their principles or their ambitions when it comes to human rights; and their critics recognize this. Criticisms of NGOs suggest that the human rights bar has been set too high, causing NGOs to be seen as irrelevant on the one hand, or as hypocrites on the other. The tragedy is therefore that human rights NGOs have painted themselves into a corner, in terms of their authority. By lambasting states’ conduct in the human rights arena, any cooperation NGOs have with states seemingly sacrifices their principles for their ambitions. Until the world’s human rights NGOs devise a strategy by which to convincingly propagate their ideals without acceding to the pressures of governmental cooperation, they will be fighting a two-front war.

Ambitions and Principles

Central to an understanding of their authority is the balance that NGOs give to their commitment to independent human rights monitoring and governmental interactions. NGOs’ take their independent, impartial reporting—as exemplified by Amnesty International and Human Rights Watch—to be their primary source of authority when it comes to human rights activism. Both organizations cite these as their core principles in their governing documents. While the principles which govern the most successful NGOs seem somewhat clear, balancing those with their ambitions to expand their member-base and bind more governments to human rights conduct is less so.

In 2011, former Hillary Clinton aide—Suzanne Nossel—was appointed Executive Director of Amnesty International with a commitment to internationalism and a belief in the US’ ability to reassert Liberal principles in IR. Nossel also defended preventive war as a way to enforce human rights obligations in other countries, which contradicts international legal obligations to secure UN Security Council authorization. Eventually, Nossel resigned from Amnesty International. Nossel notably demonstrates the ways in which human rights principles stand in opposition to NGOs’ ambitions: in order to promote and enforce liberal values of human rights, Amnesty International drew on government experience and military might.

One might further point to the increasingly professionalized trend of human rights activists and NGOs that strives to establish a firmly defined set of “shared values” as evidence that human rights discourses constitute principles and ambitions as opposing interests. Along with the movement’s professionalization and the codification of a shared value set comes an exclusion of contending interpretations and theories of human rights. In other words, to realize the movement’s growing professional ambitions, NGOs invariably narrow the scope of what human rights are, thereby sacrificing at least some activists’ principles. (The reader should be clear that by no means do I wish to philosophize on human rights in this article, but rather merely seek to identify and contextualize the contradictory interests of NGOs to either professionalize and uniformly propagate human rights standards, or endorse alternative sources of human rights justification.) By accepting, for instance, the Universal Declaration of Human Rights as the world’s principal source of human rights, Amnesty International’s statute limits debate over the extent to which economic and social rights equally constitute basic human dignity. In cases like Nossel’s and the professionalization of human rights, principles that underpin NGOs’ authority—independence, impartiality, and broadly defined human rights standards—diverge from ambitions related to enforcing human rights through force, interacting freely with governments, and creating a shared understanding of human rights.

But, how does the above discussion of NGOs’ ambitions and principles relate to Faust, and, more importantly, why should anyone care? Recall the once-idealistic Faust who, with his commitment to intellectualism, makes no headway and—increasingly disillusioned—forms a pact with the devil, thus abandoning his convictions. Indeed, this is Goethe’s lesson. In the prologue, the reader learns of God’s challenge to the devil: “Try to seduce his soul from its true source […] and if things do not go quite as you planned, / admit, with shame, among those souls that you would devour / are some that can’t be moved, even by you, / from the good they dimly, stubbornly pursue.” Faust’s entire role is predicated on his eventual decision between his principles and the temptations of ambition. NGOs similarly constitute their interests in maintaining their principles or fulfilling their ambitions, to the extent that they cannot realize both. We should care about this divide because it helps explain how, in the way that human rights discourses have been constructed, critics target NGOs from more conservative Realist perspectives, as well as more left-leaning Marxist, and Constructivist perspectives. It is worth noting that I deliberately exclude Liberalism from this analysis due to its general acceptance of NGOs—Liberals tend not to criticize NGOs, and I seek to explain NGOs critics. Therefore, I focus on Realism, Constructivism, and Marxism. However, and in spite of Liberalism’s NGO optimism, when a significant portion of the world’s population seems in favor of human rights, but several IR theorists doubt their main proponents’ normative value, IR has a significant question to answer.

Realist Critics

Human rights NGOs endure staunch criticism from Realist theorists who argue in terms of state-systems, material capabilities, balance of power, and security dilemmas. According to a 2002 interview with John Mearsheimer at the University of California, Berkeley, “there is not much place for human rights and values in the Realist story.” At least three theoretical assumptions clarify why human rights NGOs have little place for Realists. First, Realists claim that states’ material capabilities make them the principally legitimate actors in IR as opposed to NGOs’ supposed moral authority on human rights. Second, Realism holds that states pursue their interests defined in terms of power as opposed to things like human rights. Third, according to Realists, the absence of a supranational, centralized authority makes enforcing human rights untenable, and thus, their place in IR practically irrelevant.

The arguments against Realism are well-known, but few seek to explicate Realism’s relationship to NGOs. In Faust, the main character is unsatisfied with his studious life and its lack of insight into any improvement for humankind. As Goethe puts it, Faust’s “laborious studies only show that / Nothing is the most we ever know.” Moreover, Faust laments his scholarship’s inability to find “a way to improve or convert Mankind.” Faust’s commitment to learning is hence undone by the realization that it does not reveal any deep or practical insights. Discipline and studying claim a higher standard of conduct for Faust, but end up betrayed as the main character doubts their substantive ability to fulfill his life’s ambitions.

Realists take a similar stance on human rights. In The Tragedy of Great Power Politics, Mearsheimer writes on the American public’s general “proclivity for moralizing” politics and IR. In opposition to baseless political moralizing, Realists like Mearsheimer “tend not to distinguish between good and bad states” because all states pursue power in the international system. We can extrapolate the implications for NGOs from Mearsheimer’s argument with a quick parallel to Faust. In the German legend, the principles of scholarship and studiousness lacked substance like the Realist claim that distinctions between good and bad states (e.g., those states committed to human rights and those that are not) lack substance for IR theorizing. Realism tells us that states attempt to accumulate power and material capabilities and that they likely will not pursue human rights principles unless they advance a state’s power ambitions. Hence, for Realists, believers in human rights—and certainly human rights NGOs—delude themselves into believing that human rights reveal theoretical or practical wisdom for IR.

Faust sets too high of expectations for an erudite life’s ability to glean some quotient of meaning in the world, then doggedly abandons his principles because of their inability to lend insight into the universe. For Realism, NGOs similarly set their hopes too high for human rights. States, as the main actors in IR, pursue power over morals, making NGOs irrelevant and clearly unauthoritative.

Marxist and Constructivist Critics

NGOs also face criticism from Marxists who claim that their interaction with government policymakers betrays the anti-establishment principles NGOs were founded on, and Constructivists who argue that NGOs are a biased project to promote the Western, Liberal monopoly on human rights.

In his 2012 article, “The Contradictions of Human Rights Organizations,” Samuel Farber argues that NGOs provide legitimacy and support for governmental and intergovernmental agencies that they seek to hold accountable to contemporary human rights norms. According to Farber, “the world of NGOs and their supporting foundations is not self-contained,” because their implicitly liberal bias “blinds them to the political and socioeconomic context of the countries they report on.” Rather than tearing down the system as they may have originally sought to do, say Marxists like Farber, NGOs have betrayed their anti-establishment principles.

Noted scholars Makau Mutua and Stephen Hopgood offer two unrelated by similarly constructed arguments. In Human Rights: A Political and Cultural Critique, Mutua suggests that there are explicit, direct links between human rights norms and Western, Liberal principles. The abstract and seemingly apolitical nature of NGOs’ “universal” truths hides the deeply political reality of the human rights power struggle. In a similar but slightly unrelated vein, Hopgood’s Keepers of the Flame: Understanding Amnesty International unpacks the internal structure of Amnesty’s moral authority on human rights and their method for consolidating that authority. Hopgood ultimately finds that Amnesty International mirrors a religious organization’s belief in an objective moral authority for human rights and its ethos devoted to voluntarism, individualism, practicality, self-discipline, self-effacement, and moral import.

Essentially, the way that the human rights movement developed has betrayed its purpose for all of these critics. For Farber, NGOs were designed to be anti-establishment, yet now rely too heavily on governmental support. For Mutua, NGOs succumb to overly narrow Western conceptualizations of human rights, thus reconstructing a discursive power struggle that privileges the Liberal democratic system. For Hopgood, Amnesty International represents one example of an organization that has drifted from its roots towards a mission-oriented quasi-religious global operation.

Each argument presupposes a certain principled standard towards which NGOs strive. For Marxists, NGOs lost sight of their original, anti-establishment purpose, much in the same way that Faust sold his soul, therefore “exploiting everything [he] thought of worth” (Goethe’s words). For Constructivists, NGOs’ privileging of Western human rights is Faustian in the sense that human rights ideals, like the ideals of scholarship and enlightenment, constitute an overly-narrow and unfulfilling human rights theory. No wonder NGOs betrayed their principles for their ambitions as “[n]ot one hair’s breadth is added to [their] height.” Faust’s scholarly principles, like claims to universal human rights, do not imply any intrinsic higher moral authority, only the primacy of Western, Liberal norms.

Conclusions: Fighting Two Fronts

IR scholars ought to look beyond more traditional forms of knowledge in the discipline. As Professor Patrick Jackson asks: must international studies be a science? There is an immensely diverse and varied way of interpreting the world around us, whether scientific, poetic, or otherwise. Lessons taken from the poetry of German folklore, for example, shed light on the interactions between human rights NGOs and their contemporary theoretical critics across the political spectrum.

I began with the premise that IR can learn from poetic knowledge like Goethe’s. From this premise, I advanced a Faustian perspective of human rights NGOs and their critics which holds three principles. First, NGOs construct both their principles (e.g., western, liberal human rights) and ambitions (e.g., independence of state actors which they endeavor to hold accountable) that stand in opposition to one another. Second, NGOs’ independence and impartiality justifies their authority for human rights monitoring and advocacy. Third, by adopting a stringent standard of states’ compliance to narrowly-defined human rights, NGOs make it difficult to pursue their ambitions without sacrificing at least some of the movement’s principles, thus inviting Realist, Marxist, and Constructivist critiques.

Faust crammed his head full of knowledge in vain. Woefully unsatisfied by his scholastic principles, he sacrificed them for ambition and pleasure. Human rights NGOs and their critics demonstrate the same lesson. By adhering to a strict narrative of human rights and claiming a monopoly on independent monitoring, NGOs set themselves up to be cast as either ineffective idealists bent on moralizing the international system, or as hypocrites betraying the principles they set out to realize. As of right now, human rights NGOs face a two front war from both conservative Realists and left-leaning Marxists and Constructivists. Unless they can rectify the disparities between realizing their principles and ambitions, the world’s NGOs will continue to fight such a two front war.

While critics wage war against NGOs, however, we ought to remain wary of the assumption that human rights principles are mutually exclusive of organizational ambitions. To some it would seem that NGOs’ assertive—or downright aggressive—strategies for naming and shaming countries in the global South that violate human rights advances neither their ambitions nor their principles. For few will continue to support an NGO so harshly critical of so many international actors. And furthermore, few would contend that asserting human rights by force—as in Nossel’s advocacy for preventive war—genuinely constitute a principled stance on human rights. NGOs’ critics must recognize that support for human rights is on the rise across national, racial, ethnic, religious, and other lines; they do have a place in the story of IR, and they are not simply monopolized by anti-establishment politics or a sinister Western, Liberal order. NGOs, however, must recognize that human rights have the power to stand on their own. We do not need to professionalize the human rights movement. We do not need a single standard of human rights. We do not need violent enforcement of human rights. We do not need to sacrifice our principles for our ambitions.