Most nations have experienced \u27base drift\u27 of their money stocks and associated price-level non-trend-stationarities. Recent explanations for this fact have emphasized tensions among various possible objectives of central banks in closed-economy or small-open-economy frameworks. In contrast, this paper explores structural and policy interdependence among economies as an explanation for price-level non-trend-stationarities. It demonstrates that such interdependence can induce central banks to follow non-trend-stationary policies even if they desire only to smooth prices in their home economies
