Explanation
According to Simon himself (1969), the location of the stimulus, although irrelevant to the task, directly influences response-selection due to an automatic tendency to 'react towards the source of the stimulation'. Although other accounts have been suggested (cf. Hommel, 1993), explanations for the Simon effect generally refer back to the interference that occurs in the response-selection stage of decision making. Neurologically there could be involvement of the dorsolateral prefrontal cortext, as well as the Anterior cingulate cortex, which is thought to be responsible for conflict monitoring. The Simon Effect shows that location information cannot be ignored and will affect decision making, even if the participant knows that the information is irrelevant.
Logical argument for response selection:
The challenge in the Simon effect is said to occur during the response selection stage of judgment. This is due to two factors which eliminate the stimulus identification stage and the execution state. In the stimulus identification stage the participant only needs to be cognitively aware that a stimulus is present. An error would not occur at this stage unless he or she were visually impaired or had some sort of stimulus deficit. As well, an error or delay cannot occur during the execution state because an action has already been decided upon in the previous stage (the response selection stage) and no further decision making takes place (i.e. you cannot make a change to your response without going back to the second stage).
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