What does "lexicalized" mean ?

In this context it means it's considered a word distinct from its component parts.

For instance, the word ghojmoH is not a lexicalized form, because it is recognized to be just ghoj with -moH applied to it, as one does. But the word vutpa' is a lexicalized form, because although it is clearly derived from vut and pa', it's not just a simple application of pushing the two together; it's a distinct word.

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