The word imagination may have become a grossly abused cliche, but its definition has always been "the act or power of forming a mental image of something not present to the senses or never before wholly perceived in reality." [Merriam-Webster Dictionary—Premium (Tablet, version 2.0), s.v. “imagination.”] This is akin to conscious dreaming.
There’s an old saying that the “one-eyed man is king in the land of the blind.” This alludes to the fact that our faculty of imagination (the mind’s eye) has enabled humans to reign over the animal kingdom—much to the detriment of animals everywhere.
Although we may say "necessity is the mother of invention"—whether asleep and experiencing dreams from the unconscious or awake and fully conscious—our collective imagination has always been the actual mother of both human invention and innovation. This is the reason we have advanced so rapidly in tool-making, art, poetry, language (both oral and written), and prose. The Encyclopedia Britannica states that "nonfictional prose is generally supposed to cling to reality more closely than that which invents stories, or frames imaginary plots. Calling it 'realistic', however, would be a gross distortion."
[Encyclopaedia Britannica, 15th ed., s.v. “Reality and imagination.”]
"Imagination helps make knowledge applicable in solving problems and is fundamental to integrating experience and the learning process. A basic training for imagination is listening to storytelling (narrative), in which the exactness of the chosen words is the fundamental factor to 'evoke worlds'."
[“Imagination.” Accessed September 23, 2014. en.wikipedia.org/wiki/Imagination]
Psychologists interchange the term imagination with fancy, in the sense of the power of conceiving and giving artistic form to that which is not existent, known, or experienced.
[Encyclopaedia Britannica, 15th ed., s.v. “fancy.”]
Imagination has played a vital role in our creative ability throughout history. It has enabled us to conceptualize mythology, religion, culture, society, and much more. Imagination has given us the movies, theatre, symphony, and many other aesthetic pleasures. It has provided us with the innovative ability to plan and build our civilizations.
However, we have employed imagination in ways that are both constructive and destructive; creative and devastative; helpful and manipulative. For example, the myth of "original sin" is far less damaging than the destruction we have unleashed on our neighbors and our environment. Now, it is time for us to employ our imagination in ways that are collaborative and unitive, not divisive and dissociative.