One of Minecraft's many settings and options is "simulation distance." This parameter may not be obvious but it can have a significant impact on the actual setting. While things like difficulty, graphics, FOV, and FOP are relatively simple, Minecraft settings such as simulation distance can be quite complex. It can also depend on the Minecraft servers specs on how fast it's going to load, which in turn impacts lag.
Simulator distance and render distance are very similar. Simulation distance determines whether the game renders visible chunks of code and loads them in from far away. Render distance is how far from the player, while simulation distance determines whether the game renders them visible.
Minecraft players have their visible chunks loaded into via the render distance setting. However, simulation distance determines whether these chunks are active interacting with the environment. Simulation distance determines which chunks have their entities updated and which blocks ticked. A chunk activated at simulation distance will generate entities like mobs. Blocks such as water and lava will also be ticked, and the appropriate flow will occur.
Minecraft chunks loaded in render distance but not active via simulation will appear as landscape. Plant growth, animal maturation and mob spawning will not be visible unless the chunk is within the simulation distance of the player. Minecraft uses this method to save memory, because chunks beyond the simulation distance can't be viewed often and are far from the player.
You can increase your Minecraft simulation distance at will, but you should be careful. This setting is much more difficult than increasing the render distance.
This is because the game manages many mobs and other entities in the designated chunks even though players aren't there. It also takes a lot of CPU power, compared to visual rendering that uses render distance.