US Edition Fiction - including poetry - should be taken just as seriously as facts-based research, according to the team from Manchester University and the London School of Economics (LSE).
Novels should be required reading because fiction "does not compromise on complexity, politics or readability in the way that academic literature sometimes does," said Dr Dennis Rodgers from Manchester University's Brooks World Poverty Institute.
He said: "Despite the regular flow of academic studies, expert reports, and policy position papers, it is arguably novelists who do as good a job – if not a better one – of representing and communicating the realities of international development.
"While fiction may not always show a set of presentable research findings, it does not compromise on complexity, politics or readability in the way that academic literature sometimes does.
"And fiction often reaches a much larger and diverse audience than academic work and may therefore be more influential in shaping public knowledge and understanding of development issues."
Khaled Hosseini's The Kite Runner "has arguably done more to educate Western readers about the realities of daily life in Afghanistan under the Taliban and thereafter than any government media campaign, advocacy organisation report, or social science research", said the report.
It also praised the winner of this year's Man Booker Prize, The White Tiger by Aravind Adiga, for its "passionate depiction of the perils and pitfalls of rampant capitalism in contemporary India".
The novel "deftly highlights the social injustice and moral corruption that underpin the country's apparently miraculous economic development during the past decade," it said.
Brick Lane by Bangladesh-born British author Monica Ali, that deals with a young woman who speaks no English coming to London, has arguably "contributed to wider public understandings of global development issues in ways that no academic writing ever has," it concluded.
The report's title - The Fiction of Development: Literary Representation as a Source of Authoritative Knowledge - may give a hint about its authors' political leanings.
But co-author Dr David Lewis, an international development specialist at LSE, defended their argument.
He said: "Storytelling is one of humanity's oldest methods of possessing information and representing reality. The stories, poems and plays we categorise as literary fiction were once accepted in much the same way that scientific discourse is received as authoritative today."
Professor Michael Woolcock, director of the Brooks World Poverty Institute, said they were "not arguing that poets should replace finance ministers."
He said: "Fiction is important because it is often concerned with the basic subject matter of development. This includes things like the promises and perils of encounters between different peoples; the tragic mix of courage, desperation, humour, and deprivation characterising the lives of the down-trodden."
Tom Clougherty, policy director of the Adam Smith Institute, said fiction was "a useful tool in aiding people's understanding, sparking their interest, and humanising issues".
But he warned: "There's a problem. Fiction works by appealing to people's emotions, not their intellect or rationality."
He said issues like poverty and international development were "emotionally charged" and consequently solutions often failed to take into account hard, unpalatable facts.
"Years of aid won't sort out fundamental problems," he said, concluding: "Fiction absolutely can't replace factual, evidence-based analysis."