Chomsky's competence-performance distinction led to his formal approach (study of competence). The formal approach focuses on the structure of the language, emphasising the deductive properties of the language system (generative rules, algorithms); looking a patterns within the linguistic elements. Language is an autonomous, arbitrary system whose form is independent of its function

The functional approach focuses on communicative properties, and the way that ideas are organized within the language, emphasising the inductive aspects of the language (rules-of-thumb, heuristics); linguistic elements are studied in terms of how they contribute to the functions of language (communication being the major one). Language is not arbitrary and autonomous system but rather is shaped by the communicative functions it serves.

Ethnographic approaches are interested in locating particular instances in their broader cultural context. Understanding this cultural context involves making sense of specific activities, and in this way ethnographic studies of literacy are interpretative. This means accepting that there can be different perspectives on an event, and that its participants can have different perceptions of it. Contemporary ethnography accepts uncertainty, and it accepts that different people have different understandings of the same situation. It focuses on individual perspectives, and an interest in the sense-making and theorizing of participants. Being interpretative also means that analysis involves sense-making and theorizing on the part of researchers.