This research explores the introduction of the Youth Allowance policy in Seoul City as a result of the novel welfare politics in the form of insider-outsider cooperation, and analyses its success from the institutional activism perspective. Previous actor-centred welfare politics approaches focused on who leads on the policy-making while strictly discerning between the inside and the outside of the official polity. In contrast to such assumptions of the preexisting approaches, Youth Allowance policy was formed through the insiders and outsiders’ collaborative governance. The role of institutional activists as a bridge between the inside and the outside is highlighted in this research. Institutional activists with the Director of Seoul Innovation Bureau in center guaranteed the substantive participation of the outsiders and persuaded the sceptical government officials and the city councillors to materialize the policy ideas they came up with. They also actively defended it when the conflict arose with the central government on the implementation of the policy ideas. The case of Seoul city’s Youth Allowance policy demonstrates that the inside-outside boundary of an institution in welfare politics is blurring and that the potential for an institutional activist to serve a meaningful role in a welfare reform has increased. This case also serves as an example for the potential for a new type of social movement that can represent the outsiders of the labour market in Korean welfare politics.