How does caffeine affect cognition? does it actually speed up thought or simply create an illusion that it enhances/speeds up thought?

Yes it does: Speed up thoughts , just do not take more than 2 cups /day to avoid palpitation and anxiety.

Caffeine: Caffeine can speed up thinking processes a bit, and improve declarative memory (such as memorizing lists). But it doesn't help when it comes to creative energy -- thinking beyond basic tasks. Caffeine only increases the output and quality of your work if the work you're doing doesn't require nuanced or abstract thinking. In the process it makes you more vulnerable to stress. Hmmmm . .