Abstract
This paper examines the private returns to education in the context of heterogeneous labour markets, using Peru as a case study. While education is widely considered a key driver of individual earnings and economic growth, its actual returns may be constrained by structural features of labour demand. Drawing on nationally representative household survey data from 2016, 2019, and 2022, we estimate Mincerian earnings equations with Heckman selection correction to assess how returns to education vary by employment status (employee vs. own account) and sector (formal vs. informal).