This branch of economics has suffered from several intellectual mistakes. The major mistake has been the presumption that standard economic theory is… - Theodore Schultz

The advance in knowledge and useful new factors based on such knowledge are all too frequently put aside as if they were not produced means of production but instead simply happened to occur over time. This view is as a rule implicit in the notion of technological change.

Although it is obvious that people acquire useful skills and knowledge, it is not obvious that these skills and knowledge are a form of capital, that this capital is in substantial part a product of deliberate investment, that it has grown in Western societies at a much faster rate than conventional (nonhuman) capital, and that this growth may well be the most distinctive feature of the economic system.

Cultural and behavioral scholars are uneasy about this use of their studies. Fortunately, the intellectual tide has begun to turn. Increasing numbers of economists have come to realize that standard economic theory is just as applicable to the scarcity problems that confront low income countries as to the corresponding problems of high income countries.