"Setting" comprises not just a geographical location, but also the historical/ social context and the time period when the story takes place.
The geographical setting of "The Minister's Black Veil" is in New England, particularly in a small town named Milford. Hawthorne traditionally sets his stories (and novels) in actual locations, some of which come with a backstory as in the case of "The Custom House" in The Scarlet Letter, for example.
There is, indeed, a "city of Milford" in Massachusetts, but we can only assume that Hawthorne used this as yet another real location on which to base his story. This is because it is not certain whether Hawthorne was referring to "the" Milford, Massachusetts or if he just happened to use that name for no real reason.
An important dimension of the setting is the time period in which the story is set, which is colonial New England. By "colonial", we refer back to the...
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