When we remember that this is often called the Age of Imagination we see why it is that children love being told stories, and telling stories themselves.
The kind of story varies with the age. At first the three- or four-year-old wants stories of his immediate environment, and if he can recognize himself in them he is delighted. But soon his imagination roves farther afield, and it has been to satisfy him then that fairy tales have been written in all ages. A fairy tale is, of course, not one limited to fairies, but one in which desired effects are achieved by supernatural means. Girls like fairy tales better and longer than boys, who soon begin to crave for heroes and deeds of daring.
We have long given up the practice of telling stories with a moral to young children, but the effect of any story upon a young childs mind is always carefully to be calculated; if it is likely to cause fear, or improper views about human conduct, e.g. that stealing or lying are meritorious actions, it is to be avoided.
The telling of stories by children is to be encouraged as a natural form of self-expression which will lead later to fluency of speech, unselfconsciousness in society, and an easy habit of composition.