Kartini Shastry's research background is in the field of economic development, focusing primarily on questions of education, health, and savings behavior among poor households. This field seeks to understand why some countries are rich and others poor and how economic policies can be used to improve the well-being of individuals in developing countries. She is especially interested in the decisions these individuals make. One focus of Shastry's research relates to how household decisions, such as whether to enroll in school, responded to the growth in job opportunities for well-educated English-speaking workers in India in the 1990s.

Another research direction studies whether financial education can be effective in improving the financial decisions people make, such as how much to save. Shastry examines this question in very different contexts, such as required high school courses in the United States and mandatory workshops among employees of gold mines in South Africa.