In my opinion at least the vast majority of settings are fictional in some way. We also need to remember that setting refers both to place and time. If it's in the future it's fictional. If the trash can is on the other side of the road it's fictional. If there really were a hundred people in that street at the the time you set it to but in your story there are only ninety-nine it's fictional. In a sense these examples only draw inspiration from those places. In a way even those that are directly copied are just that: copied. There are many other things to decide, too. Is it in our world? A parallel world? Another planet? It is supposed to be in an existing place? Is it supposed to resemble an existing place? Is it in a fictional place in a real region of a real country? Is it unspecified? What do you as a writer know? What are you to tell the readers? Is it in an alternate history timeline? Is it in the past, present or future? Personally I prefer at least making up towns or buildings, if not cities and countries. In a sense it's mostly about if you're using the name and/or location of a real place or not, not about how much the ficticious location resembles the inspiratory place or not. For example I've created the fictional town of Muchasleches which is somewhere in western Texas (and I don't know it more precesely than that and I don't ever plan to), and I still wonder how (much) I want to tell my readers about it, and it's further complicated by the fact that the story's set 350 years into the future in a different political situation and narrated by characters from that time who don't really know about how things are back now (Mindfuck, huh?). But it varies from story to story and from author to author what is preferred and what is best.
My preference is to have real elements in an unrealistic framework; thus, on the low end of fantasy, it might be a place in this world that stays unspecified, while on the high side, it'll be a fantastic world with recognizable technology or cultural elements.
The setting for your novel/story is obviously governed by what genre you are writing. You would not write a story that included a Rolling Stones concert and set it on another planet, would you? If you are writing Science Fiction then the skys the limit, isn't it? Setting a story in New York about an alien invasion in 1963 is cool as long as its Science Fiction, but a story set in London England in which Abraham Lincoln is assassinated wouldn't work for obvious reasons.
Hybrid real/fictional in my case. The first part of my story is set in a city very much like Dallas, although I don't give the city's name. I make up the streets and place the motels, convenience stores, housing project, and viaduct where I need them to be for the foot-chase scene. The street names are fictitious and carefully selected to avoid real street names. But the reader is likely to guess Dallas from the context (Big city in Texas north of Houston, south of OKC, with something that closely resembles the Trinity River). My characters drive through Oklahoma City (real), Salina, KS (also real), and wind up in Lyndcutt, KS (fictitious).
like the above poster said it all depends on the type of story, but for the majority of the time I pick a real location..(depends whether or not I want my audience to relate to the characters of the story) if it is a complete fantasy (scifi? utopian?) just make up your own place...
Really i think it just depends on the writer's preference and your location exactly. I live in Nebraska and my book is based in a mountainous/valley setting depending on the character's locations whereas i live in a hilly, thickly forested area. Take this quote from a chapter in a novel i'm working on for instance: The mountains rose out of the flat earth like behemoths; covered in snow and only rarely revealing exposed rock or earth. Icicles hung thick over their cliffs, just as the trees sprouted over every inch of available space, their roots tangling with each other as they stood like sentinels- long dead from the cold, unrelenting grip of winter. Imagination can take you anywhere -but if you prefer to have your settings set in a real place, I suggest be careful about the time and the place, because if you stick a fictional story about the future in 1910, some people will get confused.
I prefer to write a "real" setting, although made up does have its appeal. The problem is that if I make up a setting, I need to plan it out. Names, locations, races, flora, fauna, etc. I'm an off-the-cuff, on-the-fly writer, so planning like that isn't exactly my forte.
I prefer to make a blend of a realistic setting and fantasy setting. My setting is an alternate reality, so to speak, in which the world developed in a different way, so the look of the world is kind of like a modern steampunk. So while it is set in the United States, the city where my main characters live is entirely fictional. (Actually it blatantly states in the story that the city was once called Los Angeles pre-war). So I think that it really does depend on what suits your story. Although it is easier to write about places you live in, I would not want to set my story where I live. I love southern california, but don't know enough about it to write about a specific place. Therefore, I use a fictional city and an alternate history/reality.
When I read, I don't really care if the setting is 100% fictional or reality-based, as long as it is well written. However, for my own writing, I tend to go with 100% imaginary settings, although I am always inspired by real settings and locations. I think you have to have the experience of living in a place for at least a month in order to know what that place looks like and what it feels like to live in it. I have been to Paris, but I was only there for a few days. I would never dare to write a story set in Paris. It is too famous a city, and there would be a great risk of saying something unbelievably stupid and uninformed about it, annoying the reader who does know the city and is able to recognize that the author clearly doesn't know what (s)he is talking about. Unless, of course, the story is told by the POV of a tourist, then it is doable. For example, I live in Brazil. I have read stories set in my country that are just so full of cliches and ready-made images it is blatantly clear that the author only read a travel guide, or visited the city (usually Rio de Janeiro) for three days or so. A hundred and fifty years ago, when the world was less complicated, a writer could just travel to a city, spend two months there, and write to his heart's content. Today, this kind of thing is only possible if you are rich... or very very detached from the physical world.
I use real places with a lot of poetic license. The way I figure it, I should have a working knowledge of the locale, but how many readers are going to?
It depends what you feel comfortable with and what goes with what you are writing. I will quote Cogito: If a real setting exists that fits the needs of the story, I'll gladly use it. If not, I will create one.
