Oil dependency and happiness in net oil-exporting countries: is it a curse or blessing?

The resource curse hypothesis postulates that countries endowed with and dependent on abundant natural resources tend to underperform in socioeconomic and development outcomes than those with fewer natural resources. Recently, a few studies argued that this curse also manifests in lower life satisfaction or happiness. Focusing on 31 net oil-exporting countries over the 2006-2019 period, we find no evidence that oil rents (and aggregate and disaggregate resource rents) have an adverse effect on happiness or subjective well-being. This contrasts with recent studies using a global sample. We further contribute to this debate by examining the channels of resource curse or blessing along with income, unemployment, inflation, levels of human development, and governance. We show that oil rent enhances the positive marginal effects of income on happiness. We find no evidence of this conditional effect through other channels. Being rich in oil or natural resources is not necessarily a curse on happiness, but, if any, it is a blessing through income-generating well-being.