In addition to the problem of defining what literacy is, there is the problem of explaining what literacy does. Graff (1979) labels this as the literacy myth or the widespread belief that if people become more competent in reading, writing and other basic skills, they will become more productive. According to this viewpoint, the achievement of basic reading and writing skills is both a necessary and sufficient condition for social and economic progress, as well as personal success. This is the fundamental assumption justifying the need for large-scale national literacy projects for disadvantaged groups. However, as Fagan (1998) counters, "education alone was never seen as a job ticket; many other factors had to enter the picture" (p. 86).

Graff (1979) critiques the overly simplistic claim of what literacy can accomplish. He also argues that factors other than literacy are the underlying causes of problems such as poverty and crime. He maintains that when all the emphasis is placed on the false potential of literacy to prevent poverty and crime and make people happier and more productive, other factors are overlooked. Graff (1979) states that "The reality [of national literacy movements] is more complex, is harder to face politically… the level of literacy is less important than issues of class, gender, and ethnicity; lack of literacy is more likely to be a symptom of poverty and deprivation than a cause" (p. 18).

Literacy has been described as a social process with context being very important, and each community having its own literate culture and view of literate behaviour (Bhola, 1996; Delgado-Gaitan, 1994; Ferdman, 1990; Horsman, 1990). This, in turn, influences how individuals acquire and engage in literacy. Barton (1994) is quick to point out that people have different experiences and various demands placed on them and as a consequence, they experience "different worlds of literacy" (p. x). Fagan (1998) acknowledges that many people with a low level of literacy attainment who might be labelled low-literate function well in their own sociocultural context. They feel that their literacy skills are adequate to meet their requirements and do not perceive a need to upgrade. At the same time, they may place a higher value on other aspects in their lives, such as their family, and measure quality in life through means other than the level of literacy attained.