Notable books of 1980 -- a checklist; FICTION

THE COLLECTED STORIES OF EUDORA WELTY. New York: Harcourt Brace Jovanovich $ 17.50. Here in one gratifyingly thick volume is the work, dating from the mid ' 30s to the present, of our most distinguished living woman of letters, classics of their form that bridge the immeasurable gap between craft and art.

THE COVENANT, by James A. Michener. New York: Random House. $15.95. In a near-900-page novel, spanning 500 years, encompassing all of South African history, and tracing three imaginary families (African, Afrikaner, and English), Michener offers an impressive overview, sometimes encumbered by too much history , sometimes dulled by colorless prose, yet largely successful in embracing all South Africa's people without favor to any one particular group.

THE HOUSE ON PRAGUE STREET, by Hana Demetz. New York: St. Martin's Press. $ 8.95. A novel of deep tragedy and heartwarming beauty, tracing the life of a teen-aged Jewish girl growing up in Czechoslovakia during the Holocaust, and illuminating the senselessness of hatred and the power of innocence.

MAN IN THE HOLOCENE, by Max Frisch, translated by Geoffrey Skelton. New York: Harcourt Brace Jovanovich. $7.95. This distinguished Swiss writer addresses without either romanticism or despair the problem of the human condition as he sees it in a highly acclaimed novel focusing on the decline of a retired engineer and widower.

THE NOBEL PRIZE, by Yuri Krotkov, translated by Linda Aldwinckle. New York: Simon & Schuster. $12.95. The meaning of freedom and personal integrity is never far from the surface of this artful and insightful novel written by a Soviet defector now living in the US and based on the award of the Nobel Prize to Boris Pasternak.

THE SECOND COMING, by Walker Percy. New York: Farrar, Straus & Giroux. $12. 95. From the chance meeting of two implausible characters, a retired Wall Street lawyer haunted by strange flashbacks from his past and a young woman who has escaped from dubious incarceration in a mental institution, Percy fashions an entrancing novel, a comedy shot through with serious observations and religious overtones.

THE TRANSIT OF VENUS, by Shirley Hazzard. New York: The Viking Press. $11.95 . An ambitious and challenging novel, in which destiny figures as prominently as in any Greek tragedy, tracing two orphaned sisters from Australia around the world during the 1950 s and '60s.

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