Stories that focus on local color and local tales are often associated with which Humanitarianism, Liberalism, Regionalism or Populism and why? I...

Local color and local tales are associated with
Regionalism.  This means stories which take place in a certain region will reflect the
places, people, dialect, and traditions of that
region.

Think about a story like To Kill a
Mockingbird, which is set in Alabama.  We meet what are generally the kinds
of people you would have found there, they are speaking the dialect (conversational
language) which you would have heard there, and the incidents in the work would have
been consistent with the time and place of the
novel.

Huck Finn and Tom
Sawyer are novels set in Hannibal, Missouri, and they reflect the same
things--people, places, language, and traditions of that place and
time.

Stories like the Laura Ingall's Wilder books or Willa
Cather's My Antonia are set in the plains and show how it was to
live there at a particular time--including the dialects of immigrants from a variety of
places.  Even The Crucible is an example of regionalism, as it
contains the dialects and practices/beliefs of the Puritans in that
time. 

Not all works of literature use Regionalism, of
course, but those that do allow the reader to feel as if he's actually experienced life
in that time and place.