The second chapter of Kugel's tome covers the creation of the world and the story of Adam and Eve (Genesis Chapters 1-3).
Modern Biblical scholars theorize that the Pentateuch was actually accumulated from four sources: J (Jahwist or Yahwist), E (Elohist), D (Deuteronomist), and P (Priestly). Kugel discusses J and P in his second chapter. The P source is concerned with enumerating (for instance, counting the days of the creation in Genesis 1) and with priestly rules. It refers to God as "God" until the revelation of the name "Yahweh" to Moses later in the Pentateuch. The J source focuses on human corruption and the relationship between humans and the soil. It refers to God as "Lord God." For example: "Then the Lord God formed the man of dust from the ground." (Genesis 2:7)*
This difference in sources explains why there are seemingly two slightly different creation stories. Genesis 1:1-2:3 covers a day by day account of the creation of the world, ending in a rest on the seventh day. In it, God creates plants on the third day and man on the sixth. Then Genesis 2:5-9 goes on to explain how the Lord God formed man before there were any plants. Modern scholars consider the first creation story to be from P source and the second creation story, and following story of Adam and Eve, to be from J source.
The focus of the creation story in the P source was to display the importance of resting on the Sabbath - something the P source is concerned about throughout the Pentateuch. That's why it counted the days of creation and made such a big point of God resting on the 7th day.
On the other hand, J's creation story, and following story of Adam and Eve, is an allegory for how humans developed from hunter gatherers to farmers: "therefore the Lord God sent him out from the garden of Eden to work the ground from which he was taken." (Genesis 3:23) Historically, as cultures develop agriculture, they also develop more hardy clothing to protect them in their toils. This parallels Adam and Eve beginning to wear clothes when they are sent away to work the ground.
Like Kugel's first chapter, the second chapter discusses inconsistencies that are explained away by readers - for instance, God told Adam and Eve that "of the tree of the knowledge of good and evil you shall not eat, for on the day that you eat of it you shall surely die." (Genesis 2:17). But after Adam ate of the tree, he lived to the ripe old age of 930. Why didn't he die the same day? Would God give an empty threat? No. Of course not. Because a day in the life of God lasts 1000 years:
"But do not overlook this one fact, beloved, that with the Lord one day is as a thousand years, and a thousand years as one day." (2 Peter 3:8)