"German magic-realist paintings influenced the Italian writer Massimo Bontempelli, who has been called the first to apply magic realism to writing, aiming to capture the fantastic, mysterious nature of reality." - Bowers, Maggie Ann (2004). Magic(al) Realism. New York: Routledge. ISBN 978-0-415-26854-7.
Rather than any one person or culture being its source, it may perhaps be better attributed to an aspect of human storytelling since time immemorial.