Fancy Vs. Imagination

Coleridge, in Chapter 13 of his Biographia Literaria, makes a distinction between Fancy and Imagination. Fancy, Coleridge states, is the faculty that receives images from the senses and reassembles them into a different order of time and space, without transformation. In his own words, it 'has no counters to play with, but fixities and definites.' Fancy is visualised by Coleridge as a primarily mechanical process.

Imagination, on the other hand, is heralded as a more creative process. Coleridge claims that it:

dissolves, diffuses, dissipates, in order to re-create; or where this process is rendered impossible, yet still at all events it struggles to idealize and unify. It is essentially vital, even as all objects (as objects) are essentially fixed and dead.

Coleridge, therefore, attributes to Imagination a 'vital', creative faculty.

Later, in Chapter 14, Coleridge tries to answer his own question: 'What is poetry?' His explanation of Shakespeare's 'genius' further expands on his theory of poetic creation.

For Coleridge, poetry arises from the internalised knowledge of the world. Coleridge asserts that the world must be studied and understood till it becomes 'habitual and intuitive'.

What this implies is that although Coleridgean and the general Romantic conception of Imagination centralises the poet's authority, it also in a way negates it. By suggesting that poetry is an unconscious, intuitive act, this Romantic idea of the Imagination takes away some of the poet's conscious agency.

This view of poetic creation, therefore, is not as simplistic as later critics and denouncers of it might seem to make it.

Sources:

M.H. Abrams: A Glossary of Literary Terms.
Patricia Waugh (Ed.): Literary Theory and Criticism
Samuel Coleridge: Biographia Literaria