I would say... The world would be different because it wouldn’t be as hateful as it is now. People would be more caring and loving towards each other and not choose to solve problems with violence. If someone scared another person by jump scaring them the person that got scared wouldn’t want to hurt or get revenge or be angry with the one who did the scaring.
Answer: Magical realism is set in the everyday world, so you should choose a setting for your story that is based on an actual location. You should not create a new world for your story.