Don't you think this 'logic' is kind of a numb way to look at reality? Not caring about the actual human doing the job... when you've got millions in your pocket? Standard of living in third world countries tends to be worse. Look at every global human wellbeing index in existence and you'll see they're all pretty much the same map rhymed over and over. People suffer on one side so that people can live well on the other side.
It's not like "Oh their quality of life is exactly the same as in the US it's just cheaper! So it's totally fine for us to pay them peanuts! Right? Peanuts buy you a house there... I mean the house has no plumbing but it's a house!" No, their quality of life is absolute crap compared to first world countries (as someone from a third world country). And paying them like shit will only prolong their suffering.
The least the company could do is pay them fairly which means they can travel or live a better quality life.
In Australia we do have unpaid gigs (internships etc) however the company offering that position isn't allowed to "make money" off any work that person does.
I think this is a pretty fair way to do it, they get trainees, however can't abuse people to make money off them.
Seems like this would be abused a lot though eg promises of full-time work or a better life only to be rug pulled when they find another gullible and desperate enough.
I guess everywhere can be vulnerable to this just if it's explicitly illegal or not, sad to see places try to hunt vulnerable people in situations where they will work for unfair terms instead of build high functioning teams which is think is more where YC is supposed to be aimed :(
