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The auroral zone contains a variety of interesting and dynamic plasma processes which have been the subject of intense research over the past two decades. Of particular interest is the subject of high-latitude ionospheric structure (i.e., electron density irregularities) because of their impact on communications systems. The Naval Research Laboratory has recently developed a two-dimensional inertial, electrostatic code which has been successfully applied to the development and evolution of ionospheric structure driven by plasma instabilities (e.g., E×B gradient drift, Kelvin-Helmholtz). This code models the ionosphere and magnetosphere as a set of horizontal two-dimensional layers which are coupled by the vertical magnetic field lines at high latitudes. It is shown that the development of instability-generated structure can be strongly dependent on this coupling. For example, the influence of magnetospheric coupling (i.e., inertial effects) on the E×B gradient drift instability is to retard the instability's growth and to isotropize density irregularities. The influence of ionospheric coupling (i.e., collisional effects) on the Kelvin-Helmholtz instability is to retard its growth and to suppress vortex formation. In this paper we will present the results of numerical simulations of these instabilities and discuss their application to high-latitude ionospheric structure.