Doesn't do the exact same (you'd have to add a new entry everytime, rather than point *.dev to localhost) but https://addons.mozilla.org/en-US/firefox/addon/hostadmin/ is easier to set up. It'll flush the dns cache everytime its changed.
by using something to edit the hosts file you'd have to edit it every time (can't do wildcards on hosts file, so it needs editing every time)