Good fiction enhances imagination and intelligence. Bad fiction abuses imagination and degrades intelligence -- leading to the inability to tell, "Shit from Shinola" -- to distinguish deception and low-grade creativity from authenticity and high-grade creativity -- and yes, there is validity to that distinction.
Here's what fiction, as in stories that portray possibilities that never happened, does to the human consciousness.
When read, it stimulates the imagination and also creates, through the "seepage" of imagination into memory, remembered impressions that bring a certain resonance to someone's life.
When portrayed in theater by actors, the situation calls for a suspension of disbelief that must be cared for by the playwright -- not to insult the intelligence by calling for suspension of disbelief to the point of abandoning ones intelligence or accepting the abandoning of intelligence, by others.
Fiction should not require us to be stupid, to enjoy it.
Another thing fiction does, if suspension of disbelief has been abused to the point of stupidity, is to dull our ability to tell truth (or honesty) from falsity (or dishonorable actions) -- to distinguish "authenticity " from fallacious behavior -- so that the phrase, "The Real Thing", takes on an absurd significance -- you know what and whom I mean.
Fiction, mis-handled, may leave people abandoning their intelligence for a time of distracting entertainment. That's okay, momentarily, but when it becomes a trend . . . . .
On the other hand, theatrical/film acting, well done brings, to the audience, a channel of understanding of a character, an authentic feeling based upon insight that deepens intelligence. It's a degree of depth that awakens discernment. This is the potential magic of theater, that the actor shows what is in the audience members and they recognize it, in themselves. And thus fiction may then aid recognition and release.
Thus, fiction may go two ways. The thing is, which of the two ways is more prominent, today?
When the higher possibility of fiction is made junior to the possibility of making money publishing fiction in one form or another, and money is the object, and not the artform (a high-quality product of which may call for more money in the act of creation than a poor production) the rigor of creation falls short of the level that would do anybody any good. That's much of contemporary film/cinema, theater, art and music (especially music). It seems to me the overwhelming output of film entertainment comes out motivated by a mediocre intelligence and seeks to appeal to the mediocrity and immaturity of consumers, for its sustenance -- gratuitious sex and violence, spectacle without human insight, exploitation of unnecessarily extreme turns of fictional plot (explosions, chase scenes, deaths, caricatures of "evil characters") -- you get the idea.
Fiction in the hands of fools
develops a generation of fools who can't tell the difference
between what enhances them
and what degrades them --
between shit and "Shinola" (shoe polish).
They assert the right to go any old way they want and never be questioned, about it. "Don't tell me what to do!"
Fiction can awaken or weaken the intelligence of the populace.