Information processing theory attempts to categorize how information is recognized, used, and stored in memory. It recognizes people's ability to control what information is processed and how these abilities develop over time. The document then discusses different types of knowledge like declarative and procedural knowledge. It outlines the stages of encoding, storage, and retrieval of information. Finally, it discusses concepts like short term and long term memory, forgetting, and methods to improve retrieval like rehearsal, elaboration, and mnemonic devices.