In the 1950s and 1960s, educational economists led the developing nations of Asia, Africa, and Latin American onto an educational merry-go-round where all the educated could do was seek further education. These nations have turned in the 1970s to political scientists, sociologists, and educationists in an attempt to rectify the situation. In place of "manpower planning,""universal primary education," and "investment in human capital," the new slogans are "basic education,""earning while learning,""life-long education," and "aptitude testing instead of examinations." The economist still has valuable things to say, however. For example, oversubsidization of higher education at the expense of elementary education can be reversed only if the popular demand for free higher education can be discouraged without adverse political effects. Basic education schemes appear better designed for preparing students to live in their communities but may require unavailable teaching skills to implement and may in fact institutionalize a class system Third World governments are dedicated to eliminating. The tendency of developing nations to seek educational reform without compensating reform of the labor market is self-defeating. Changes in government employment practices could go a long way toward redressing the imbalances that result. (Author/PGD)