Allusions oftentimes occur in both everyday speech and literary works. They imply referring to a certain situation, place, or person, either on purpose or unintendedly. The reference can relate to anything, for example, historical events, fiction, religious concepts, folklore, etc. 

In literary pieces, allusions have the same meaning and purpose. In many cases, they involve referring to other works of literature and require the reader to have certain knowledge about the subject.

The term first came into use in English approximately in 1540-1550. It derives from the Late Latin term “allūsiōn” that can be translated as a “wordplay”. 

Allusions, being a versatile tool, can take many forms. They are sub-divided into two groups: internal and external ones. 
Internal allusions in literary works imply the reference to something that was previously mentioned in this particular piece of literature. They are oftentimes hard to spot and rely solely on author’s assumption that the reader remembers the previously read bits of the text well.

External allusions are more common and easier to notice. They imply referencing to an object, a concept, or an event that is outside the given literary work. This type of allusion gives the author some freedom in terms of creative implementation. The author can make a reference to anything, including proverbs, history, other literary works, famous personas, and so on. The only challenge the author might face is making certain that the readers are already familiar with the object the author refers to.

Allusions can sometimes be confused with illusions as these two terms sound similar. While allusions involve references to other objects, illusions imply something unrealistic or incorrect. So, despite being phonetically alike, these two terms have completely different definitions and ways of usage.

As a literary technique, allusions serve to enhance the text, add more meaning to the plot, and inform the reader by using just a couple of words or a single phrase. It is also a helpful tool when the author wants to remind the reader of the previous parts of the text and events of the plot (in this case, the allusion is internal). 

This linguistic tool also allows the author to provide an explanation without starting a lengthy discussion. By referring to an object that the audience is already familiar with, the author doesn’t have to explain the comparison and can easily draw an analogy and add more meaning to the situation or a character he’s talking about. 

Some authors use allusions to create an ironic effect in the text by referencing and thus comparing two unrelated (and in most cases, dissimilar) objects. Oftentimes, allusions make the text a bit more complex and add a certain intertextuality to it, presenting artistic skills of the writer.

While allusions play an important and useful role in literary works, this device itself is rather tricky. When using allusions in their works, authors entrust the reader to understand the reference. So, it becomes the reader’s responsibility to grasp the allusion. Therefore, using the allusion that people might be unable to understand can put the author into a tricky situation, when the meaning of his work cannot be completely revealed. Also, this is the case when allusions can transform into something like a cultural literacy test, allowing the reader to find out how knowledgeable they are about certain subjects or events.

Allusions are prevalent not only in literature but also in common speech. People frequently use this linguistic tool in real life, sometimes not even paying too much attention to it. For instance, it is common to call a greedy person Scrooge, or, instead of saying that someone is a liar, calling them Pinocchio. Both of these examples are allusions to famous fictional characters.

As for literary pieces, there’s an interesting allusion example in one of Shakespeare’s plays. One of the characters of “Hamlet” makes a reference to Julius Caesar, which can be considered as a double allusion. Obviously, the character refers to the famous historical figure, but it can also be considered as Shakespeare’s reference to one of his previously written plays that has the same name.

Dante uses a lot of allusions in his work “Inferno”, most of which belong to the old times and need to be explained to the modern readers. He refers to the stories of Francesca and Lancelot, which were known in the literature of Dante’s days but require explication nowadays. 

In one of Lee’s literary works, “To Kill A Mockingbird”, she refers to a certain event called “the crash”. This word is an allusion to the Crash of the Stock Market, which led to the Great Depression. Here, the author uses this technique to provide some insight and explain why the Cunninghams were affected so much, without providing a whole historical background and giving a long explanation.