The Economist's Edward Lucas writes an excellent piece on how the West often denies the third world the very things that created the West's success:

Barely an eye’s blink ago in evolutionary terms, having a nice flint axe and a dry cave was the summit of human ambition. Modern prosperity is not the norm, but the result of specific institutions and habits. It is not just recent, but fragile—like water flowing downhill, wealth trickles away unless it is well husbanded. The good news is that we now know the rules of that husbandry. The bad news is that so many of us are too muddle-headed to put it into practice.

In particular, Lucas bases his opinion on the belief that trade and economic growth are the best way for third-world countries to escape poverty, rather than aid and government projects. The evidence is certainly on his side: the biggest movements out of poverty have come in India and China as their economies have grown. It seems paradoxical that those countries which have received the most aid remain the poorest, but again the evidence suggests that such aid is little use without the institutions to ensure that the money can be spent in ways which benefit the people.

A functioning economy requires more than just a pile of money. An economy is a process, a series of actions undertaken by different people, often acting in their own interests but combining to create things which are of benefit to all. It is processes and procedures which are important, not simple quantities of money spent. Without functioning processes, money is often wasted on a colossal scale. Calls for ever greater sums of money to be spent can simply obscure the problem.

The objective must not be to patronise third-world countries, or to treat their inhabitants as lesser people requiring the guidance of the clever West. Nor is it to treat them as objects of charity, poor relations who we salve our consciences by sending some money to. If the last few hundred years of history teach us anything, it is that the key to a prosperous society is the recognition of the full set of universal human rights - the right to property and economic activity just as much as the right to free speech. Democratic government is another crucial component, though it must be democratic government which respects the rights of its people, especially minorities. If those are the standards we hold our own governments to, we should hold the governments of the third world to the same standards.

UPDATE: Joe Otten has commented on the same article, though he takes a different view of its contents.