In the recent article MFA vs NYC,Chad Harbach discusses what he sees as two distinct literary camps or directions in contemporary American fiction. (I link to a short version in Slate while the full version is in N+1.)
Harbach begins with a nod to Mark McGurl's 2009 study, The Program Era: Postwar Fiction and the Rise of Creative Writing, which analyzes the role of writing programs in postwar American fiction. McGurl's book posits that writing programs have "generated a complex and evolving constellation of aesthetic problems that have been explored with energy and at times brilliance by authors ranging from Flannery O’Connor to Vladimir Nabokov, Philip Roth, Raymond Carver, Joyce Carol Oates, and Toni Morrison" (that's from Amazon's product description; I have yet to read the book itself). I hope McGurl doesn't really claim that Nabokov was a product of American creative writing programs, but we'll let that pass.
Harbach himself argues that there exists a self-perpetuating MFA-writer culture centered on short stories written by MFA-grads and published in literary journals, and that the successful MFA-grad becomes a professor in yet another MFA program, thus permanently bypassing any need to earn a living by writing. This type of fiction writer lives in a different world, and publishes for a different audience, than what Harbach calls the NYC writer--the presumably equally serious fiction writer who publishes novels with mainstream New York publishers and (according to him) usually lives in New York.
Harbach doesn't really praise one camp over the other, and maybe that's not so surprising, as Harbach is an MFA-grad and an editor at the literary magazine N+1, yet now belongs to the NYC world as in February his first novel was sold at auction for "about $650,000." While the MFA writers are busy writing short stories that are read mainly by other MFA writers, the NYC writers are cranking out novels that must hook the reader on the first page or so and that the entire book-reading population must find easily digestible. On the other hand, the (few) most successful MFA-writer stories are anthologized repeatedly, whereas novels published by mainstream presses have a short lifespan these days. In other words, either route has its plusses and minuses. If you're a successful MFA writer, you have a secure income from your teaching and your stories appear in various journals read by writers scoping out whether those journals might publish them. If you're a successful NYC writer, you have an insecure income, but more people read you when you bring out a new book.
This neat binary doesn't, of course, entirely describe the world of fiction writers. It has nothing to say about commercial fiction, or about genre fiction of a more literary bent. Writers in those categories seem to live all over the US but either publish with mainstream NY presses or in small, independent, magazines.
As a writer who hasn't fit into any of these camps or categories, I'm not wild about how anything about the American literary world functions. I've published in the same literary journals as the MFA people (although it was probably harder for me back when the MFA world was gaga over dirty realism), and I've published in small genre magazines (although not much of my work qualifies as genre fiction). I write novels that aren't about New York and I've never wanted to live there. Furthermore, now I'm in the convenient position of making a living in academia without teaching in a writing program. This has the advantage of feeding my imagination in ways that don't involve a steady diet of student fiction, but the disadvantage that my job requires a lot of work, which takes time away from writing fiction. Well--while I'd like my fiction to count toward tenure, which it won't, I like having to think about other things academically.
Some writers prefer short fiction, others prefer novels. In the latter 20th century, novelists usually first published some short fiction as a means of developing skill, but they knew there was no longer any money in the short stuff. Today, in a literary world where novels published by established houses are supposed to make an immediate splash or die, there is almost an opposite pressure: a competent writer will find at least a few journals willing to take on the short fiction, but agents and publishers are no longer as open to novels that can't be hyped and rapidly sold to a fairly large public. Harbach seems to conclude that we should all write short fiction for one another, yet isn't that a rather odd conclusion from a writer who spent nine years writing his first novel and then had the good fortune to sell it for a big price? We are not all going to settle down to teach writing to undergrads who want "undemanding classes," and while I agree with him that being a professor is a cushy job in comparison to freelance copyediting (something we have both done for a living), he seems strangely unaware of how few people these days actually get tenure-track jobs.
Ah well. Back to my day's course-prep labors, so that I can feel free to write fiction tonight, or perhaps send out a few query letters.