I’m reminded of something that my Abnormal Psych professor said about Freud, “He remains influential because he’s esthetically pleasing.”
I think that this is the core of Freud and Lacan’s continued influence in literary criticism, although most of the theoretical frameworks that were popular in the late twentieth century have been falling away as a historico-textual approach with a dose of New Criticism dominates in most critical discourse these days.
Much of what appealed about literary theory was not so much its applicability but its somewhat onanistic esthetic pleasures. Most (all?) of the writing about deconstructionism was theoretical in nature with little critical writing actually applying the principles of deconstructionism. Freudian and Lacanian criticism tended to make it out of the graduate literary seminars and into the pages of journals, but this was largely because they were in a sense more practical, providing a framework for being able to look at a text in a useful interpretive manner.
I can’t write a whole lot about Lacan. He’s dense to the point of being incomprehensible as evidenced by this exchange from The Four Fundamental Concepts of Psychoanalysis:
Lacan: Have I thrown some light on your question?
J.-A. Miller: Some light and some shadow.
With Freud, things tend to fall into two categories: An overly complicated proto-behavioralism (e.g., the account of the woman who had trouble drinking water because she had seen a dog lapping water sloppily from the pitcher¹) and an application of literary traditions to psychoanalysis that had dubious applicability to his patients’ real problems (e.g., the Oedipus Complex).
Both of these work better in a literary critical context. A Skinnerian behaviorialism might be workable for understanding a text, but it doesn’t really make for an esthetically pleasing way to write about the text and part of literary criticism is not simply making an argument, but making it in an esthetically pleasing way (your college English professors might not have acknowledge as much but it is very much an aspect of humanistic academic writing).
The latter concept, on the other hand, is directly connected to literature and influenced by it as well. There was a back and forth between the literary tradition and Freudian psychoanalysis where the framework not only influenced the interpretation of texts but was influenced by the interpretation of texts. Add in the fact that post-Freud,² many writers were fascinated by Freudian concepts and deliberately inserted them into their texts and Freud ends up being more relevant in the halls of the English department than the Psychology department.
This is a half-remembered anecdote which I don’t really have time to dig up now.
This is also the case with Marxist thought as well.