Small Instantons, Little Strings and Free Fermions

We present new evidence for the conjecture that BPS correlation functions in the N=2 supersymmetric gauge theories are described by an auxiliary two dimensional conformal field theory. We study deformations of the N=2 supersymmetric gauge theory by all gauge-invariant chiral operators. We calculate the partition function of the N=2 theory on R^4 with appropriately twisted boundary conditions. For the U(1) theory with instantons (either noncommutative, or D-instantons, depending on the construction) the partition function has a representation in terms of the theory of free fermions on a sphere, and coincides with the tau-function of the Toda lattice hierarchy. Using this result we prove to all orders in string loop expansion that the effective prepotential (for U(1) with all chiral couplings included) is given by the free energy of the topological string on CP^1. Gravitational descendants play an important role in the gauge fields/string correspondence. The dual string is identified with the little string bound to the fivebrane wrapped on the two-sphere. We also discuss the theory with fundamental matter hypermultiplets.