In "Two Kinds" by Amy Tan, the story is set in the United States (in San Francisco); the U.S. has been considered by so many for so long (even today) as the "land of opportunity."
Jing-mei is the main character, who lives with her immigrant mother. Although the story is set generally in the U.S., Jing-mei and her mother live specifically in Chinatown, which is reminiscent of the China Jing-mei's mother has left behind.
What little they have financially comes from her mother's work cleaning other people's houses. With this sense of her new country's grand opportunities, Jing-mei's mother decides that her daughter will be a child prodigy playing the piano, and arranges to trade cleaning services for piano lessons.
Jing-mei is having none of this, resisting the dream that her mother is forcing on her; her mother wants Jing-mei to be a success primarily to impress her friend, Lindo Jong, whose daughter is a chess champion.
The actions of the characters directly connected to the setting are Jing-mei's mother's sense that anything is possible in the United States, including "teaching" her child to be a piano virtuoso, which is unlikely and unfair.
With memories of her years in China, its poverty and heartache (abandoning her babies there), and the success she sees her friend experiencing, the setting pushes Jing-mei's mother to pursue her own American dream, though not the dream of her own daughter.
The place and time settings are quite significant to the characters' actions in Tan's "Two Kinds." The place setting, San Francisco, has a large Chinese population, which causes Jing-Mei's mother to put even more pressure on Jing-Mei to succeed and to be a prodigy so that her mother can gush over her in front of her peers.
Similarly, the time period (the 1960s) continues some of the idyllic elements of 1950s America during which Americans, especially immigrants, believed that they could achieve anything in the Land of Opportunity. Jing-Mei's mother possesses that American Idealism and wants Jing-Mei to be and do everything that she was not able to become or do in her native China. Thus, keeping the setting in mind, a reader is better able to understand why there is so much tension between Jing-Mei, who has always known the safety and idealism of America, and her mother who knows what life can be like for people, especially women, who do not work hard or who do not take advantage of the opportunities that her daughter has.