The Cave, by José Saramago, trans. Margaret Jull Costa

A man of clay against the shadow world

José Saramago is now in his 80th year: a time for philosophy, perhaps, and not the first time a venerable author has looked to Plato for inspiration. After he won the Nobel Prize in 1998, the Portuguese writer pointed out that his was an unusual body of work: "If I had died when I was 60, I would have written nothing."

The Cave is in a sense his testament, a conscious allusion to the work that went before – as a political activist, journalist and editor, passionate about Portugal but frequently in exile.

In one of his characteristic lists, Saramago describes the virtual "Centre" that is to replace the world of reality in this novel. He mentions its "varied installations", which include "an Amazon river complete with Indians, a stone raft... a comet, a galaxy, a large dwarf, a small giant". This catalogue is drawn from the 10 books Saramago has prolifically produced over the last couple of decades. It is the overlap between history and art, in the personal experience of both author and reader, which intrigues us here.

In The Cave, Cipriano Algor is a potter. He shares his home with his daughter Marta and son-in-law Marcal, and his life with his dog (Found) and the widow Isaura Estudioso. Cipriano is defeated by market forces beyond his control or understanding. Having devoted his life, like his father and grandfather, to clay and the kiln, living in rural anonymity and supplying the city, he finds that creativity has been rendered redundant in the voracious new world order.

Despite an inexplicable renaissance, when Cipriano is requested to switch from pots to clay figurines, he is finally obliged to desist from living as he has always done. Cipriano attempts to adapt by moving to the Centre, where Marcal is a security guard. Sharing an apartment where daylight never penetrates, he roams the Centre, with its mysterious and ubiquitous signs. The signs speak in commercial exhortations, seeking to reassure residents of their value as consumers, but causing dislocation. To the exploitation of the labourer is added that of the consumer, while managers and advertisers have become faceless and manipulative.

One insomniac night, Cipriano explores the subterranean bowels of the Centre, where secretive excavations have taken place. The natural cave, with its unnatural purposes, reveals the deathly intentions of this entirely artificial world. Cipriano can only look to repudiate it with a return to human values, to a land peopled only by his chosen few – and by a flock of clay figurines.

In Plato's cave, the prisoners' sense of reality applied only to the shadow world reflected on to a wall. In Saramago's cave, reality lies buried beneath a welter of virtual experience: we can no longer even tell the weather. In a recent interview, Saramago told me that "Western civilisation has never been as close to living in Plato's cave as we are now... We no longer simply live through images: we live through images that don't even exist."

It has taken his consummate skills, and those of his translator Margaret Jull Costa, to convert this ancient parable into a novel with impact – and, surprisingly, hope and charm.