TO A TEMPORARY refugee from America, where book

stores sometimes seem to sell nothing but titles like Nightbite, Batwing and The Hacking, Italy at first seems like a literary paradise. Glossy new titles by Italian writers flood the bookstores and are discussed in trendy, literate newspapers like Rome's La Repubblica and Turin's La Stampa. Every corner newsstand manages to jam into its dizzying array of newspapers, puzzles and lottery tickets, a copious selection of classics--from illustrated editions of Dante to paperbacks by Alessandro Manzoni, Gabriele D'Annunzio, Ignazio Silone and Italo Svevo. Last year's centenary of Carlo Collodi's Pinocchio was a national event; so was the funeral, sometime later, of poet Eugenio Montale, attended by both the president and the prime minister of the republic.

But this respectful attitude toward literature hides a more worrisome situation facing contemporary Italian writers. "In Italy, there is respect only for things which are far away--like the saints," says Angelo Guglielmi, who combines the functions of director of the Rome Office of RAI, the state television network, and literary critic for Paese Sera, a Rome daily run by the Communist Party. "It would be better if people respected books less and bought them more."

In fact, virtually all the houses of Milan, Italy's publishing center, are in crisis, facing layoffs and cuts in their lists. More and more space in bookstores is being taken by foreign bestsellers such as Azteca by Gary Jennings, La stoffa giusta by Tom Wolfe and Natura morta con picchio by Tom Robbins. Italian publishers suffer from their own version of il complesso blockbuster, the quest for il long-seller, while a serious Italian novel is extremely lucky to sell 20,000 copies, and more likely to stall at 2,000.

Nevertheless, Guglielmi contends, Italian writers have made notable achievements in the '70s, creating and refining a number of new styles and genres. To prove the point, Guglielmi recently edited a handsome anthology of their work, Il piacere della letteratura ("The Pleasure of Literature"), which was published in November by Milan's Feltrinelli. The selection is somewhat cavalier--Italo Calvino is represented by a selection from Citta invisibile (Invisible Cities) and Alberto Moravia appears not as the author of La vita interiore (published in the United States as Time of Desecration) but as a "travel writer" and author of Lettere dal Sahara ("Letters from the Sahara")--his African reports originally published in the newspaper, Corriere della Sera. And Moravia's world-famous wife, Elsa Morante, does not appear at all--Guglielmi dismisses her La Storia (History: A Novel) as "a lachrymose story designed to sell as many copies as possible."

Nonetheless, the book and its editor can serve as a useful, if idiosyncratic, introduction for Americans curious about recent developments in Italian letters. In Guglielmi's reckoning the '70s was one of the most fertile periods of the postwar era. Between the liberation and about 1960, Italian writers were busy doing what Mussolini had forbidden-- simply recording the daily life they saw around them. In the '60s, however, writers and critics began looking beyond the peninsula, and foreign doctrines such as new criticism, structuralism, and formalism became fashionable.

But this critical ferment was often at the expense of original work--and it was not until the 1970s that Italian writers regained center stage from the theorists. "These have been the years in which the creative work itself returned to center stage," Guglielmi says. "They have been pretty good years. Perhaps there have not been towering peaks, but we have had a good output of work of medium quality."

Among the most controversial and productive writers of the '70s is Leonardo Sciascia, whose political parables, including A ciascuno il suo ("To Each His Own"), Il giorno della civetta ("Day of the Owl") and Todo modo ("Every Way"), have assailed targets beginning with the Mafia of his native Sicily and progressing to the entire corrupt political, legal and ecclesiastical structure of the country. Luigi Malerba has conducted icy explorations into the absurdity of contemporary life and language in Salto mortale ("Somersault") and Il Serpente ("The Serpent"). Paolo Volponi has assaulted the formalism of Italian life and language in Corporale, the story of a post-'60s radical shuttling between the repressed life of a clerk and the urban underworld of petty crime and terrorism. And Stefano D'Arrigo, in his voluminous novel which took 20 years to write, Horcynus orca ("Killer Whale"), has recast The Odyssey into the story of a Sicilian soldier returning home after Italy's military collapse in World War II.

But from Rome's literary salons to Milan's editorial offices (and nearby banks), the most fashionable writer is currently Umberto Eco, a professor at the ancient University of Bologna, whose historical novel, Il nome della rosa ("The Name of the Rose") won lavish critical praise and enormous financial rewards, capping them off with last year's Premio Strega, Italy's best-known literary award.

Eco, a semiotician and scholar of French structuralism, has constructed a psycho-mystery literary novel which unfolds in a 13th-century monastery in central Italy. Critical influences from Thomas Aquinas to Jorge Luis Borges and Roland Barthes play hide-and-seek in the story of how Don Guglielmo da Baskerville--monk, librarian, and ecclesistical Sherlock Holmes--solves a series of baffling crimes by turning to the books on his library shelves which include a lost volume of Aristotle's Poetics.

"What Eco wanted to do was coldly apply the most advanced critical theories of Europe and America, which show that fiction is nothing but a mechanical structure with which one can do whatever one wants," Guglielmi says approvingly. "Using these, he has taken the Thomist thought of the 13th century and constructed a kind of new Three Musketeers, which has been a great success, both publicly and critically."

Although satisfied with the present, Guglielmi believes that a feeling of cultural openness--or nakedness --pervades literature. "The Italians today are the least chauvinistic people in the world," says Guglielmi. "There are no more barriers. Whatever happens in other countries affects us almost at once."