The impact of increased model resolution over the Arctic/midlatitudes is explored using a hierarchy of Slab Ocean simulations in which the ocean heat transport is fixed, and fully coupled ones where the ocean circulation is interactive. We compare slab ocean and fully coupled simulations with uniform low-resolutions (LR; ~1^o) and Arctic regionally refined meshes (RRM; ~0.25^o over the Arctic and subarctic) within the Energy Exascale Earth System Model (E3SM) framework. When ocean heat transport is fixed, the increased resolution improves atmospheric transient and quasi-stationary eddies in the mid-latitudes. Through an eddy-momentum feedback on the zonal mean atmospheric circulation, better-resolved eddies also cause a strengthening and poleward shift of the upper-level jets in the Northern Hemisphere in winter, resulting in a decrease in Arctic local temperature and an increase in Arctic sea ice extent and thickness. A positive sea ice albedo feedback further enhances the increased Arctic sea ice extent, while negative cloud feedback over the Arctic dampens the cooling response. The response results in an overall cooling of the Northern Hemisphere and a southward shift of the ITCZ in the RRM slab simulation compared to the LR slab simulation. The opposite effect occurs when ocean circulation is interactive in the fully coupled RRM simulation, where the cooling over the Arctic and midlatitudes drives an increase in the AMOC and ocean heat transport into the Arctic compared to the LR simulation. The increased ocean heat transport into the Arctic counteracts and outweighs the Arctic cooling impact of poleward shift of the upper-level jets, leading to an increase in Arctic temperature, reduced sea ice, and a slight northward shift of the ITCZ in the RRM full coupled simulation compared to the LR. The results imply that the increased model resolution over the high latitudes can have global climate impacts beyond improving simulations of local transient weather events.