The theory behind dictated stories

So why am I writing down Isadora's stories? The dictated story has its roots in the Language Experience Approach to reading (Allen, 1976; Stauffer, 1969, 1980). To quote from the text Assessment and Instruction of Reading and Writing Difficulty (Lipson & Wixson, 2003),

"As a beginning reading method, LEA promotes student awareness of the relationship between oral and written language by having students produce a 'language experience story.' This story then become the reading material that is used for the delivery of instruction. Because this eliminates problems of a mismatch between the student's language and the reading materials, the technique has been widely used for very beginning learners..."

The goal is that Isadora will eventually read back the stories to me, but right now she just likes to have me write down the stories, have me re-read them, and then giggle about them.