The impact of economic changes on Canadian universities in Ontario since World War II is explored, with focus on how universities were perceived by the public, why they were supported during the period of expansion, how they set out to fulfill their prescribed functions, and how they were affected by the diminished opportunities and cooler economic climate of the 1970s. In addition to gaining the political and financial support of important business interests, the universities were primarily funded by the Ontario government, which provided coordination and consultation rather than administering the universities directly. Both school and business stressed the importance of a well-rounded undergraduate education. It is suggested that, without the widespread faith in the economic value of higher education as a whole, funds would not have been so freely available for humanities and social science programs. Although there were labor shortages in the early- and mid-1960's, heavy investment in professional programs could be rationalized. By the mid 1970s, economic problems and shifting perceptions about the economic utility of the university resulted in reduced funding. Doctoral graduates faced difficulties in finding appropriate positions, and collective bargaining, including the unionization of university faculty, occurred. The way that the universities were influenced by the values, culture, and political forces of a mixed capitalist economy is emphasized throughout the analysis. (SW)