"Autobiographies and most novels bore me because they are only too possible" wrote Gabriel Josipovici in 1990. No doubt this is why his fiction since that time has tempted impossibility with ever more insistence. Both The Big Glass (1991) and Moo Pak (1994) record the attempts of two men, one an artist, the other a novelist, to create their own magnum opus. More specifically, they record, in each case, the efforts of a friend to record this recording. One copies extensive notes left by the dead artist, the other relays one-sided conversations with the novelist on long walks around London. By doing this, Josipovici's own struggle to create is displaced by implicit commentaries on his apparent failure to do so. For what are these recordings of recordings of recordings if not implicit admissions of failure?

His new novel Goldberg: Variations, ups the ante by featuring not one but two writers struggling with their latest work. While we do seem to be a long way from "most novels" here, a casual outline of part of the story - two writers tormented by writer's block - doesn't indicate an alternative to the alleged "insularity" of literary fiction. Many general readers have already been warned off "writing about writing" by populists in the Press; they will assume it represents "a failure to engage with the real world". Yet, if a story is before us anyway: entertaining, stimulating, even moving, what kind of failure is it?

The answer perhaps lies in the title. Bach's colon-less Goldberg Variations was composed, the legend goes, to aid the Goldberg of the title with his patron's insomnia. Not to bring on sleep exactly but at least to get him through the long white nights. The opening chapters of the novel suggests it is about the same failure to sleep. They are set in the 18th Century, when Samuel Goldberg, a jobbing writer, is summoned to the grand abode of Tobias Westfield, an aristocratic philosopher who cannot sleep. As a craftsman, and in the hope that it will lull Westfield to sleep, Goldberg is expected to write during the day and, at night, read what he has written as Westfield reclines in his four-poster. Westfield insists he write something new. "I have read all the books that have been written, Mr Goldberg, and it makes me melancholy" he says. Specifically, he wants a "new story" because "a story which is really new and really a story, will give the person who reads or hears it the sense that the world has become alive again for him." Goldberg wonders respectfully whether such bringing to life would have the opposite of the desired effect. On the contrary, says Westfield, in such a new work "the world will start to breathe .. where before it had seemed as if made of ice or rock. And it is only in the arms of that which breathes that we can fall asleep."

It's a nice idea, and, as a philosopher, Westfield is full of ideas. He has polite yet keen conversations with Goldberg about them. He says he cannot stop thinking and it keeps him awake. So, we assume, he needs the long, straight road of narrative to distract him from thought. The problem is that Goldberg soon finds he cannot provide a story. He struggles to write anything except a homesick letter to his wife. He offers no excuse to the bewildered gent who expected a story just as he expected a tune from the harpsichord player he had recently dismissed. So what does he do? It turns out that what Goldberg reads out to Westfield is that letter to his wife. It's what we're reading too. Westfield, of course, like many an indignant reader of "modern fiction" might complain this as not really a story let alone "a story which is really new"; the promise of sleep has been delayed yet again.

So ends chapter one. This might have been left as a neat short story. And in fact, Josipovici excels at that form. A recent story - A Glass of Water - based on an exhibition of Chardin's paintings, ends so soon that it evokes in the reader the same emotion as experienced by the narrator of the story itself. Much as we want it to continue in order to fill in the empty spaces, if it were any longer it would lose precisely what makes it so special. In carrying on here, adding a further 29 chapters, that loss is risked. One would expect the novel to open up into a larger narrative. It doesn't quite. Some chapters consist of dialogue in a carriage, some are made up entirely of letters, others are in more familiar narrative form, telling stories of Neolithic archaeology and incest in the Orkney Islands, or of a mad poet based on Friedrich Hölderlin. There's even one that consists solely of a precise description of what seems to be a storeroom. It is possible that it is a description of a painting of a storeroom. The variations link together, mostly because they feature members of the Westfield family as well as Goldberg, but an overarching narrative is not explicit.

One looks for answers. Chapter sixteen, the first of the second half of the novel, has a variation on the opening chapter. It records a "flyting" or poetic competition at the court of the German-speaking King George III. "Flyting" is a northern European word. In the middle ages, it took the form of improvised verbal jousts in which opponents flung crafted insults at each other. In the more genteel surroundings of the court this would be too much, so Goldberg is asked to improvise on this theme: a man who had enough wanted everything and was, as a result, left with nothing. It is added that the story is to be treated as tragedy. Rather unpromisingly, Goldberg chooses to analyse A Nocturnal Upon S. Lucy's Day, Being the Shortest Day, John Donne's poem from 1633; a kind of stand-up lit-crit. The King closes his eyes as Goldberg introduces his improvisations. Maybe the King is concentrating, maybe he is dozing. In order to follow, he needs to concentrate. So do we. Goldberg interprets the Elizabethan's poem as a lament for the death of the one with whom the poet shared a perfect love. She was everything to him. With her death, the world was taken too. He became "a dead thing in whom love wrought new alchemy"; love "ruin'd me, and I am re-begot/ Of absence, darkness, death-things which are not." Love, and so this poem, is only a cruel surplus of strength unwinding Lazarus in his winding sheet.

By the end of the analysis, the King is awake and attentive; Goldberg receives polite applause. However, once away from the arena, Goldberg has his doubts. At home, he writes a revised analysis and sends it to the King, including some variations on the same theme and an apology for what he sees as his poor performance at court. Whereas before he saw the poem as an expression of irredeemable dejection - perhaps like his own letter to his wife - he now sees "things which are not" as the "the true centre of [the poet's] affective being". By facing absence, darkness and death, the poet finds that the world slips into irrelevance and the remaining negativity "somehow" takes on "a powerful life". The poet announces that he will "prepare toward" the loved one in the darkness. He embraces his fate. That line, Goldberg contends, turns the poem into a celebration; the poet has turned tragedy into a happy ending - a comedy, in Dante's sense. It's an interpretation that would not have coincided with the required theme set by the King. But Goldberg sends it to him anyway. It seems as unsatisfactory as the letter to Goldberg's wife; "somehow" is hardly enough to make us assent to Goldberg's claims for the redeeming quality of that powerful life of negativity. It also seems a perverse thing to put in a novel in the first place.

While we might leap to condemn Josipovici for shoe-horning his abundant skills as a literary critic into the novel, what becomes clear reading the variations within the same chapter is that "most novels and autobiographies" are, more or less, commentaries in themselves, only concealed. To those familiar with the usual stuff of English novels - "Trevor felt that Phoebe had outstayed her welcome, particularly after the unpleasant incident with the gherkin, but kept it to himself" - the tales are unsettlingly bare:

"1: A young man leaves his family and home in order to pursue a dream of glory and fulfilment. He returns, many years later, wealthy beyond the imagining of those he had left behind, marries, and lives out the remainder of his life in his home town, admired and respected, with a loving wife and children who are a success in every way. On his death bed he thinks: So this was life? At least if I had stayed at home I could have ended up dreaming that, if only I had had the courage to seek my fortune instead of remaining at home, I would have ended up a happy man."

It has the same intriguing paradox Goldberg saw in Donne's poem. It goes for the novel itself too. Contained within the one chapter we almost have a microcosm of the whole: the space between our idea of contentment, and contentment itself. One might also call it the space between knowledge and ignorance, or between wakefulness and sleep. In a later chapter, Goldberg offers Westfield the idea that his philosophising is in fact a kind of anxiety - leaping from one thought to another without stopping, as if afraid to pause because pausing might risk the danger of engagement with life and, more pertinently, with death. He offers the ideas to Westfield that before he can sleep, he must wake up.

The tension at play here reminds me of a remark by Jason Cowley made in a review of a novel by Marina Warner: "Gabriel Josipovici" he announced "knows far too much". As a result, he claims, his fiction is "imprisoned" by his "considerable intelligence". Unknowing as this might be, one can see it substantiated and refuted in Goldberg: Variations. It asks: if knowing far too much keeps one awake, and perhaps thereby unable to write, how does one sleep? As Westfield, the novelist is trapped by endless thought that stops sleep-giving narrative in its tracks. As Goldberg, he is prevented from providing patient narrative by the infernal pressures to provide it in the first place. He might offer what is expected, but that would be dishonest, just as Westfield might close his eyes yet not gain rest.

One has to ask then, are all the chapters, like the first, written by Goldberg to be read to Westfield? It becomes clear that the answer is "No", because from just before halfway, Gerald appears. He is a modern day writer on the way with his wife Edith to view the Paul Klee painting Wandering Artist (a poster) in a private collection in Switzerland. He has long been fascinated with the work (it's the one on the front cover of the novel). He hopes it will inspire him to complete a book he has been writing. By admitting to a lack of confidence over what he has written already ("What have I to do with Goldberg, Westfield … and the rest?") we understand he is the author of what we've just read. So will he be the reason and the end for it all? It seems he doesn't know himself. He began writing with enthusiasm but it soon petered out. He becomes so preoccupied with finishing the book that Edith leaves him. (In fact, she announces this in front of a painting suspiciously similar to the storeroom described in chapter five). A later chapter consists of Gerald's abandoned letters to her, while others return to Goldberg and Westfield. But Gerald despairs of it all. Everything previously so close has retreated from him. He stares at a postcard reproduction of the Klee. He studies the meaning of the German title, and finds that it means, not as assumed, a nomadic artist, but a public performer moving from place to place, perhaps as an actor or even a conman. Somehow. this gives him an unaccountable boost to continue. Perhaps he will be able to finish his book.

Do we find out if he does? Well, yes, perhaps. We take a step back from reading his musings to a third-person focus. We read him in conversation with an unknown other discussing his problems. Together they wonder what is now close to his life, closest to his own needs and desires. Gerald is unsure. "Perhaps, the other says, what is near can only be arrived at by talking about what is far away". In this way, we meet, in effect, the third writer of the book; the one who goes unnamed. Perhaps it is Gerald. Perhaps it is Gabriel Josipovici. Perhaps neither. Anyway, he is the one who succeeds in writing the book; the one for whom "the powerful life of negativity" has "somehow" worked. Everything has fallen away and yet he has found a way forward. Actually, this third writer appears like the stick figure of the Wandering Artist itself; a mystery. What is it doing? Are we being signalled to? Is it painting, waving goodbye; what? It's impossible to say with any certainty. That is why it's such a compelling painting, and also why this novel in turn cannot be reduced to "writing about writing", of which we can fully expect it to be accused.

Goldberg: Variations also seems to be definitively unfinished. There are thirty-two parts to Bach's musical version. Josipovici has included only thirty chapters. What we read is perhaps just what the title says: variations. Have the bookending arias not been written because they would announce and close the theme? One has to wonder about what is left out; what has not been written; perhaps what it is not possible to write. As it is, there is far more to this novel, despite being under 200 pages, than this review can encompass; and perhaps even what the novel itself can encompass. Characters and stories teem from the pages, though never for the sake of taking it to blockbuster length. Yet, at the same time, it still manages to address the issue of what often gets left behind in such teeming: the individual sitting quietly alone with the book. Are you reading this to fall asleep or to wake up? It's a difficult question, one that some critics would rather wasn't asked, but it opens the reader, somehow, to the possibility of happiness.