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Margaret Atwood's – whose latest book, Hag-Seed, will be released early October – is seen on Sept 27.Fred Lum/The Globe and Mail

You may know Margaret Atwood as a bestselling author, environmentalist or inventor, but lately I've been more closely following the Canadian icon's spin-off career as a writer of 140-character theatre criticism.

When not busy novelizing or speaking, Atwood can often be found out and about at the theatre. And, after she's digested a performance in Toronto or elsewhere, she will usually tweet out a mini-review – complete with hashtags and elaborate emoticons. For instance, like me, she enjoyed the Stratford Festival's production of Macbeth this season – but expressed her appreciation much more succinctly: @margaretatwood: Excellent #macbeth at @stratfest. Authentic #witches! (From One Who Knows.) >:>}

Meeting The One Who Knows on the patio of a Toronto café to talk about her Shakespeare-inspired new novel, Hag-Seed, this Atwood – the theatre critic – is on full display, as she eagerly elaborates on her feelings about the Macbeth still on in Stratford, which she has been attending for most of its existence.

"I liked that they made [the main characters] younger than they usually are, because it made sense of Lady Macbeth's falling apart," Atwood says, with slow, deliberate enthusiasm. "When she's played as this tough matron, you think, 'Why would she fall apart? She's so tough.'"

An interesting observation – but, thankfully, I don't have to worry too much about Atwood taking over my job. In Hag-Seed, the author gets to indulge her inner theatre critic to her heart's content, and also mine her long-standing appreciation of both Shakespeare and the Stratford Festival. The novel is part of a new series from Hogarth in which well-known authors riff on or retell a favourite play by William Shakespeare for the occasion of the 400th anniversary of the playwright's death.

Howard Jacobson has written a work suggested by The Merchant of Venice, while Jeanette Winterson has, naturally, taken on The Winter's Tale. As for Atwood, the moment Becky Hardy – the editor of the series and the "child of an old friend" – approached her, "I immediately thought of The Tempest."

Hag-seed concerns a Canadian theatre director named Felix Phillips who puts on a production of The Tempest at a local prison with a cast of inmates who have colourful nicknames like 8Handz, Leggs and SnakeEye. At the same time, Phillips also seems to actually be living out the plot of Shakespeare play's – using his actors and production to enact revenge against the men who overthrew him as artistic director at a theatre festival many years earlier (the way the wizard Prospero pulls of a similar trick on the men who exiled him from Milan and wash up on his enchanted island in Shakespeare's play).

As with anyone with a true love for Shakespeare, Atwood is not particularly reverent about the playwright – and enjoys questioning him on many dramatic decisions, ambiguities in his plays' plotting and characterization that, were they written today, we would see as gaping holes.

"Is Shakespeare really deep, or did he just not have a continuity editor?" asks Atwood, who studied with the Shakespearean scholar Northrop Frye when she was at Victoria College at the University of Toronto – and credits his book On Shakespeare in her acknowledgments.

Writing about a theatre director putting on The Tempest allows Atwood to float her own theories about the play – for instance, that there are nine prisons in Shakespeare's play (she even provides a handy chart outlining them all).

Sometimes she – or, at least, the character of Felix Phillips – can be a bit of a nitpicker, wondering how Prospero and his daughter Miranda bathe or get their protein on the island they live on, for instance. But her biggest question is what happens after The Tempest ends – when Prospero throws away his magic staff and books, frees his fairy assistant Ariel and heads back to Milan with Antonio, the brother who had usurped him as duke and exiled him.

"If you were Prospero, would you then get back on the boat with the same guy who tried to kill you?" asks Atwood, an illusion creator herself, sporting a floppy-brimmed "Prospero hat" for the occasion of this interview. "And, before doing that, would you throw away your most potent weapons and dismiss your air spirit?"

In Hag-seed, the prisoner-actors offer up a series of possible aftermaths to The Tempest – a succession of chapters I suggest reads like Shakespeare fan-fic. "Of course, much of what we think of as classical literature is fan-fic," Atwood notes, quite correctly. "We have the Iliad. We have Chaucer's Troilus and Cressida. And then we have Shakespeare's Troilus and Cressida."

Hag-seed will no doubt appeal to Atwood and Shakespeare's fans around the world – but those who regularly make the pilgrimage to the Stratford Festival will be particularly tickled by its thin disguise as the "Makeshiweg Festival" in the book, located in a small-town with a main drag that features "Celtic woollen-goods outlets" and "handsome Victoria yellow brick houses with their occasional bed-and-breakfast signs" and peters out into "a string of drugstores and shoe repairs and Thai nail bars."

Felix Phillips, the main character's name, is likewise a "little tribute" to Robin Phillips – who ran Stratford during one of its most acclaimed periods in the late 1970s and died last year.

Not that the fictional Phillips's artistic approach to Shakespeare has any resemblance to the real-life Phillips. Atwood's character does a lot of "in-your-face envelope-pushing" – staging Pericles with spaceships and aliens, for example, or having Hermione come back to life as a vampire at the end of The Winter's Tale. "[Robin] Phillips was much more subtle," Atwood says.

While the author's history as an audience member at Stratford predates the Phillips era, her life with Shakespeare goes back even further – to a trip to see Laurence Olivier's 1944 film of Henry V in theatre when she was just, well, V years old. "My parents couldn't get a babysitter, so they took the kids," she recalls. "We were told to sit there and not make a noise."

Olivier's film – especially the whizzing arrows – left a strong impression on Atwood. But so did the performances of Shakespeare she later saw in high school, when the Earle Grey Players came to perform whatever play happened to be on the Grade 13 exam.

That semi-professional troupe of actors inspired part of Atwood's very first commission as a young writer – The Trumpets of Summer, a 1964 collaboration with composer John Beckwith about Shakespeare and Canada created for the playwright's quatercentennial – and also makes an appearance as themselves in her 1988 novel Cat's Eye. The Earle Grey Players are part of the nearly forgotten pre-Stratford tradition of theatre in English Canada – amateur and semi-professional companies, part of the Little Theatre movement, many of which would gather every year to compete at the Dominion Drama Festival.

At college, Atwood saw much of that kind of theatre – Donald Sutherland was a contemporary at Victoria College – and even had a role in Ben Jonson's Epicœne. "That's why I know how to do a full curtsey," she says.

That pre-Stratford spirit of stage performance where the line between amateur and professional blurs is certainly alive in Hag-seed and its prison performance. Indeed, the novel falls into a perhaps unappreciated subgenre of Canadian literature – fiction about amateur, semi-pro or underfunded productions of Shakespeare.

Notable works in that vein stretch from Robertson Davies's Tempest-Tost (1951), about a small-town troupe putting on The Tempest, to Carole Corbeil's In The Wings (1998), about a Toronto alternative theatre's production of Hamlet, to Aaron Bushkowsky's Leacock-nominated Curtains for Roy (2014), in which A Midsummer Night's Dream is staged at a winery in the Okanagan Valley.

If theatre has often inspired novelists, though, the reverse is equally true. As if Hag-seed isn't a hall of mirrors enough in itself, consider that it's currently making an appearance as a prop on London's West End, too.

There, director Phyllida Lloyd – who knows Atwood since she directed The Handmaid's Tale opera at the Canadian Opera Company – is directing an all-female production of The Tempest at the moment. It's set in a prison and, at one point, the character of Prospero is handed a copy of Atwood's new book. "It gets more and more meta-theatrical," says she, The One Who Knows.

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