o theories of late industrialization explain national differences in the institutional and organizational characteristics of contemporary business? How do these ideas help to explain variations in economic performance? The level of economic development of the country effects development of institutions and characteristics of the business, which in return affect performance. In first part of the essay we will discuss early industrialisation and different theories of late development. After discussion will lead us to key institutions: financial markets, textile industry in relation to business group and labour market and steel industry with relationship to government intervention. In the conclusion we will discuss the current situation, highlight that there is no perfect system. There are many factors that effect economic performance and in order to be successful the changes in the world should be accommodated with the changes in institutions and organisational characteristics. The main characteristics of industrialisation are changes from agricultural to industrial economic structure, substitution of machines for human skills and replacement of home-made by purchased in stores goods. The First Industrial Revolution happened in early 18th century in textile industry in UK, they had technological means, right institutional and organisational characteristics, government encouragement, and a large and varied trade network. Britain became the world's leading industrial power, producing more than half its iron, coal and cotton cloth, with most of their raw materials sourced from the colonies. By early 19th century USA took over UK’s leading role, both of them were able to succeed due to mechanisation and large pools of skilled labour. The pioneers of the Theory of Late Development described later industrialised countries as economies that started