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Farm diversification by farmers’ open-door policy generates opportunities for farmers to internalize externalities of multifunctionality. Although the educational function of agriculture is an example of such an open-door policy and is attracting growing attention, this function has been little explored. To promote farm diversification in this direction, this paper examined how and to what degree farmers internalize externalities of multifunctionality by focusing on the educational function provided by dairy farming, i.e., farming experience services, in Japan. The main findings were as follows. First, we can say that the educational function is determined by ordinary technical jointness as well as institutional jointness, which is represented by food culture and the agrarian heritage. Both the technical and institutional jointness enhanced the externality. Because of these two working factors, there is a U-shaped relationship …