Writing Forum

The type of story you describe (D&D/LOTR) is known as High Fantasy.

First, let's define Tale as the sum of all the words you write, and the story as that quintessential bit of the tale that is the reason a reader reads the tale in the first place. Story includes the MC, plot and anything else that without which, the story doesn't work.

When it comes to deciding what type of government you want/need for your story, you have to give it the litmus test. Running through your tale is the the story, the thing that propels the reader from one scene to the next, and gives them a reason to keep reading. Everything else is just confetti - the landscape, what the towns look like, what colour dress she's wearing, what rank odour offends your MC today. Confetti.

You need the confetti to flesh out your world, and in doing so, make it possible for the reader to immerse themselves in it. Back to the test...

Is your government absolutely essential to the story, or is it just confetti?

If it is essential to the story, then it must have a form that suits the story, and only you can decide what form that takes. You might lean on current or previous forms of government (there have been many to choose from). If your story requires an entirely novel form of government, then that's what you need.

If it is confetti - that is, the government doesn't play a leading (or meaningful) role in the story, you can do whatever you want. Just bear in mind that a communist or democratic government doesn't sit well in a feudal society etc. Whatever you chose has to make sense within your world.