In MN 18, Ven. Thanissaro explained the term as:
"Translating papañca: As one writer has noted, the word papañca has had a wide variety of meanings in Indian thought, with only one constant: in Buddhist philosophical discourse it carries negative connotations, usually of falsification and distortion. The word itself is derived from a root that means diffuseness, spreading, proliferating. The Pali Commentaries define papañca as covering three types of thought: craving, conceit, and views. They also note that it functions to slow the mind down in its escape from samsara. Because its categories begin with the objectifying thought, "I am the thinker," I have chosen to render the word as "objectification," although some of the following alternatives might be acceptable as well: self-reflexive thinking, reification, proliferation, complication, elaboration, distortion. The word offers some interesting parallels to the postmodern notion of logocentric thinking, but it's important to note that the Buddha's program of deconstructing this process differs sharply from that of postmodern thought"
Ref.: http://www.accesstoinsight.org/tipitaka ... .than.html