The cocktail party effect refers to people's ability to focus on a single talking person or conversation in noisy environments.
For example, if you talk to a friend in a group of loud people, you can listen and understand what your friend is talking about - while ignoring what other people nearby are talking about. It is an ability that diminishes with age. Older people have problems doing that.
The cocktail party effect does not work with audio recordings, neither in mono nor stereo.