Nominalization happens when we transform a verb or adjective into a noun. It also has to be something that isn’t a real thing in the world. In other words, you couldn’t put it into a wheel barrel. In fact, come to think of it, nominalization is, in itself, a nominalization. It’s a noun that isn’t an actual, real-world object. Some other examples include: accuracy, righteousness, superiority, excellence, and destiny. You can see nominalization happen in old philosophy and old psychology texts quite a bit. That’s odd, because philosophers have published material critical of this for centuries.
Nominalization gets really bad when a number of nominalizations, or a chain of them, are discussed as though they were definite, real, understood things. When people do this, they come in all sorts of weird conclusions. Here’s an example. Someone said that atheists believe in a dog-eat-dog world. The deep structure that went on in their mind went something like this. Atheist equals evolution. Evolution equals Darwinism. Darwinism equals social Darwinism. Social Darwinism equals survival of the fittest, which equals no compassion for those in need, a dog-eat-dog world. But social Darwinism is a political philosophy that only got Darwin’s name attached to it because it resembled natural selection, which is a part of the theory evolution. On each side of that weak link, the chain contains fairly good generalizations. Most atheists believe in evolution. Social Darwinists believe in a dog-eat-dog world. But those two chains are only linked by a completely irrelevant nominalization. The verb “to evolve” becomes a noun: evolution. Then, that noun gets attached to social Darwinism only because Darwin discovered evolution. The jump to social Darwinism is only possible because of word play. This is what we mean when we say that people live in a fantasy world because of acting like words are real things. But there is often a hidden agenda behind nominalization. People who are not very introspective may not even realize that they are pursuing an agenda. The person who said atheists are dog-eat-doggers wanted so badly to feel superior to non-believers, that he came up with this as a response to research showing that atheist doctors were doing more for poor people than religious ones. Outside of NLP, a word for nominalization is reification.