I'm pretty sure there are tons of folks out there just like me living comfortable lives with their oDesk earnings.
Of course, you get what you pay for. Most people looking to hire on these sites aren't interested in quality; they want quantity at a discount. It works well for both them and the people doing the work at least in the short term. After all, some money (food) is better than nothing. I consider it a pretty base form of exploitation, though.
Pick a country in the list on that page where the Per Capita Income is less than ~$4160/year. Most likely, in such a country, $2/hour is very likely going to put an individual at or above the median income (farther above, the lower the GDP Per Capita). $5/hr is a nice wage.
For comparison, the UN ranking of the US in this category is ~$51,000, and the median household income in the US is about $55,000 (per year).
If you land a job making $5/hour, full time 40 hour weeks, that's $800 a month. A LOOOOT of people here would kill for that kind of salary.
Seems like there would be an opportunity for developers to donate laptops/hardware to people in developing countries who could use them to make money. I have at least 5 sitting around my office, only 2 of which are in use. I guess the logistics would kill it, but still.
It would be very hard to donate laptops here in Bolivia because of how this ass-backwards government handles importing goods and taxes when importing something.
What you make in a couple of days, they make in a year. It's mind boggling. Yes, cost of living is cheaper, but not that cheap.
On the plus side, you feel like you can make a difference in their life. If you're living there, you can pay them a great salary, without breaking the bank. Or if you're visiting, they might not expect tips, but hand someone $5 that went out of their way to give you a free ride on their moped, and you just dropped a few days income in their pocket.
I came in a little below that and got several gigs at $30/hr, mostly in esoteric areas like OpenGL programming.
Also I would recommend watching your job invites and you'll start to notice which areas are the least sensitive to hourly rates. For me that's been 3D work in iOS, but YMMV.
I'm trying to move to a daily rate, in that case I would assume only 2-4 hours of coding daily because when you are really in the zone, most of your problem solving work happens off the computer. So I think that's why we see rates of $75 or even $125 or more quoted so often.
The other thing I've learned is that institutional work pays a lot more, so it's better to find gigs for consultancies/studios/education, things like that, as opposed to individuals. They seem to expect a rate of at least $50-75/hr and up. In large cities the rate probably starts at $100/hr.
Anyway, I'm basically taking a pay cut as a freelancer so that I can work on my own projects, which have the potential to pay back exponentially someday, and are at the very least challenging and rewarding and keep my psyche going. I've had jobs where the boss charged $100/hr and paid us $15/hr, and on top of that wanted us to work 9 hours or more a day, and I did the math and realized that I would never be able to achieve my goals if the lion's share of my efforts went to someone else.