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Freudian Dictionary

It would seem to me the most convenient plan to give dementia praecox the name of paraphrenia. This term has no special connotation, and it would serve to indicate a relationship with paranoia (a name which may be regarded as fixed) and would further recall hebephrenia, an entity which is now merged in dementia praecox.[1]

Patients suffering from dementia praecox or schizophrenia whom I propose to term paraphrenics display two fundamental characteristics: They suffer from megalomania and they have withdrawn their interest from the external world (people and things).[2]

The libido that is liberated by frustration does not remain attached to objects in phantasy, but returns to the ego; the megalomania then represents the mastery of this volume of libido, and thus corresponds with the introversion on to the phantasy-creations that is found in the transference neuroses; the hypochondria of paraphrenia, which is homologous to the anxiety of the transference neuroses, arises from a failure of this effort in the mental apparatus.[3]