THIS paper investigates some consequences of treating seriously the distinction between insiders and outsiders. By insiders I mean incumbent workers with previous work experience with a particular firm. Outsiders are those without employment or newcomers who have just been hired by a firm and are beginning the transition to being future insiders. To make this distinction as sharp as possible, I assume that insiders derive their market power from firm-specific training and experience so that the firm cannot augment its stock of insiders by buying in experienced workers from other firms. Clearly this assumption is extreme-for example one need think only of the golden hellos which were offered to financial analysts hopping between firms in London during Big Bang-but it has the merit of establishing an upper bound on the market power incumbent workers could conceivably wield. In the world I wish to contemplate present hiring determines the firm's future stock of insiders and time is of the essence. In such a framework, it is natural to model bargaining as a forward looking dynamic game. Indeed it would be quite inappropriate to model the bargain in static terms and then append some dynamics as an afterthought. Dynamic games quickly become complicated and intractable yet it is desirable to formulate a model in which clear analytical solutions can be obtained. In this paper I adopt the device of a simple overlapping generations model in which workers can work at most two periods. Newcomers N begin work in the first period of their lives. If they remain with their firm in the next period they become insiders I. In each period the firm earns revenue R from its insiders and newcomers. To establish an upper bound on insider power, I adopt a particular formulation of the familiar monopoly union model. Specifically, I assume that insiders earn a wage w and newcomers a wage x. Current insiders are the union in the sense that they make the firm a unilateral wage offer (w, x) subject to which the firm then makes employment decisions. Thus the purpose of the paper is not to explain the particular form of bargaining equilibrium between the firm and its workforce but to investigate the nature of equilibrium when incumbent workers set wages in a dynamic game representation of the monopoly union model. Here, the two period