An article in the Wall Street Journal's Business Technology blog reports on research that James Anderson conducted for NEC. The research found:

someone using a larger monitor could save 2.5 hours a day. But James Anderson, the professor in charge of the study, tells the Business Technology Blog to take that result with a grain of salt: It assumes that someone will work non-stop for eight hours, which no one will, and that the tasks they perform will all benefit from a larger screen, which isn't always the case. But things like moving data between files are ideally suited to bigger or multiple screens. Anderson, who uses a computer with two 20-inch screens and one 24-inch one, recommends that businesses take the time to match employees with the proper size screen based on job requirements.

From Business Technology : Bigger Computer Monitors = More Productivity
Referenced Wed Mar 12 2008 18:48:39 GMT-0600 (MDT)

I interested that they found no benefit from monitors larger than 24 inches. Task related I'd suppose. I've gotta say, I love 30 inch monitors. Love them.

I'd love to see a similar study on programmers. I'd bet the results are the same.