A method for operating a dimerization reactor that receives a hydrocarbon feed and produces an output stream comprising a light hydrocarbon component, a dimer and an alcohol component comprises: (a) separating the first output stream into a top stream containing the light hydrocarbon and a bottom stream containing the dimer, with the alcohol being present in the top stream or the bottom stream or both; (b) contacting at least one of the bottom and top streams with a water stream so as to extract at least a major portion of the alcohol therefrom, thereby forming an water/alcohol stream; (c) contacting the water/alcohol stream with a hydrocarbon stream so as to extract at least a major portion of the alcohol present in the water/alcohol stream into the hydrocarbon stream, thereby forming an alcohol-enriched hydrocarbon stream; and (d) feeding the alcohol-enriched hydrocarbon stream into the dimerization reactor.