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This is a great question. Most stories have a good amount of detail when it comes to setting. So, when a story does not have much on setting, it is for a special reason or reasons. Two reasons come to mind.
First, Shirley Jackson wants the reader to use his or her mind to reconstruct the town from what he or she know of towns in general. In this way, the town can become any town. This adds to the effect of the story. In particularly, there is an erie tone, because this town can be a town not too far away from a town that the reader knows.
Second, the deemphasis on the setting allows for the author to focus on the characters. In this way the personalities of the people and their actions come to the fore. This is why the characters in the short story are so memorable.
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