I hate the term. “Literary fiction” is therapeutic. It is what is good for you, what you should read.
As currently used—that is, to distinguish fiction with high-culture pretensions from “popular” or “genre” fiction—the term can probably be traced to New York Times book critic Michiko Kakutani.
In January 1984, in an article entitled “Mysteries Join the Mainstream,” Kakutani struggles to explain what she means. Everybody knows that there are “suspense stories” and there is “ ‘serious’ fiction,” but “it is not quite as simple as many bookstores would have us believe to separate books into such categories as ‘Suspense,’ ‘Famous Authors’ [and] ‘General Fiction.’ ”
The occasion for her article seems to have been the popular success of Humberto Eco’s Name of the Rose. Paraphrasing Eco’s views, Kakutani says that “serious” writers “have begun now to appropriate old-fashioned storytelling techniques from the popular genres. . . .”
Kakutani then delves into literary history:
Before the 1980’s, the term literary fiction was used either to refer to an authorial pose (Wyatt’s claim to write songs for the lute, for example, was a “literary fiction”) or to distinguish the fictional (i.e., not literally true) from fiction that is written down and published in a book. That’s how the Marxist critic H. Bruce Franklin used it in The Wake of the Gods (1963), opening his study of Melville with the declaration that “since all myth is by definition fictional, no one should be surprised to find that literary fiction is mythic.”
Now the term is used by tedious self-promoters like John Banville, who insists that his 2005 Booker Prize-winning novel The Sea is a “real book,” that is, “literary fiction” as opposed to “more populist work.”
Balls. The only meaningful distinction is between writing that is good and writing that is not. The Sea may be “literary,” but it is lousy.