<![CDATA[Agricultural diversification and circular economy practices offer opportunities to strengthen the economic resilience and multidimensional welfare of farming households in agrotourism areas. This study examines value-added creation, circular economy implementation in agricultural waste management, and differences in objective and subjective welfare between traditional and diversified farming households in the Berastagi District Agrotourism Area. A descriptive qualitative approach with a comparative design was employed through observation, documentation, and in-depth interviews with purposively selected informants. The findings reveal that traditional farmers face downstreaming constraints arising from limited post-harvest technology and capital, skill gaps, and dependence on middlemen through the ijon system. Meanwhile, the agrotourism market and circular economy remain underutilized despite substantial economic potential. Diversification into premium products can increase net profits by up to threefold, while processing coffee pulp into organic fertilizer can reduce chemical fertilizer costs by up to 40%. Beyond economic gains, diversification contributes to ecological sustainability by reducing negative environmental externalities and improves multidimensional household welfare. Objectively, it generates more stable cash flows to support children’s education, while subjectively reducing persistent anxiety associated with price volatility. These findings demonstrate that integrated diversification and circular economy strategies can simultaneously strengthen farm profitability, environmental sustainability, and household welfare.]]>
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