Here is an excellent, succinct set of slides which explain what the postmodern short story is and why it came about.

tl;dr

The postmodern short story came in the middle of the 20th century. Stories became anti-stories:

  • plots lost cause and effect relationships
  • “reality” appeared in quotation marks
  • characters were flattened and artifice foregrounded
  • symbols convoluted upon themselves.

— MARY ROHRBERGER