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The term funds of knowledge was coined by anthropologist Eric Wolf in 1966. He defined funds of knowledge to include such categories as caloric funds, funds for rent, replacement funds, ceremonial funds, and social funds as resources and knowledge that households manipulate to make ends meet in the household economy. Years later, in 1988, findings from an ethnographic study of households in the U.S.-Mexican borderlands by Carlos G. Vélez-Ibáñez and James B. Greenberg identified diverse and abundant funds of knowledge that existed within families in Mexican communities. Additionally, it was determined that households are self-sufficient and do not depend on the economic market for assistance and well-being. Instead of looking to the economic market for assistance, communities develop networks among households, and funds of knowledge are distributed socially and exchanged among households.

Funds of Knowledge in Education

As a result of Carlos G. Vélez-Ibáñez and James B. Greenberg's original study, other anthropologists, researchers, educators, and teachers, along with Vélez-Ibáñez and Greenberg, moved to examine how the concept of funds of knowledge can be applied to educational settings. Findings show that funds of knowledge are based on the belief that people are competent and have various levels of knowledge (skills, abilities, ideas, and practices), which they have historically developed and gained through their lived experiences. It is the bodies of knowledge that underlie the activities of students’ households and communities. Students’ household members develop social networks that interconnect with other households in the community. It is these relationships that contribute to the various kinds of funds of knowledge that students possess and bring to the classroom.

Diversity and Learning

As a result of Luis C. Moll, Cathy Amanti, and Deborah Neff's work in extending funds of knowledge from an anthropological context to an educational context, the term has gained a great deal of attention as one way to disrupt discourses of deficit ideologies. Deficit ideologies blame the underachievement of students from diverse backgrounds on perceived deficiencies they believe are related to students themselves, their families, and their cultures.

Furthermore, they blame underachievement among these students on inadequacies such as home literacy practices, language skills (specifically in English), motivation, parental support, and self-concept. As a result, expectations and acceptance of low academic achievement becomes normalized. Most implicit in deficit ideologies is the idea that student achievement among students from diverse backgrounds is unrelated to schooling but rather related to their lives at home. Critics argue this is a result of schools failing to acknowledge the kinds of social capital obtained by students and their families from diverse backgrounds.

A New Framework for Educators

Funds of knowledge offer a new conceptual framework for informing effective practice to assist educators in meeting the needs of their diverse learners. The ideology behind funds of knowledge is that the best way to learn about students’ lives and backgrounds is by focusing on practices that occur on a daily basis in students’ households and by learning about what students do and how they articulate what they do in their homes and in their communities. The goal is to identify what students have versus what they do not have and to dismantle assumptions and stereotypes by learning about their students outside the classroom. Identifying unique student and family experiences and linking them to instruction are a key component of the funds of knowledge framework.

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