Water & nutrients needed to grow leaves moves up through the xylem. This is the part of the tree you can see after you remove the bark. The phloem transports photosynthate to other leaves & roots. When you girdle the tree, photosynthate being moved to roots, along with other by-products of photosynthesis including auxin, hits the air layer and accumulates in the tissues immediately above the layer. The cambium is comprised of meristematic cells, meaning they are not differentiated into specific tissues yet. The accumulation of auxin (sometimes helped along by applying rooting hormone) causes the meristematic tissue to favor the formation of roots instead of shoots.

Al

OK. But after the roots...form... does the lower part of the mother tree in any way nourish the part that is forming the roots?

Yes. Your layer depends on the water & nutrient flow through the xylem to supply what's needed to keep your layer viable until enough roots and vascular connections have formed so your layer is self-sustaining. At that time, the layer can be carefully severed from the parent plant & potted.

Al