Some excerpts from this interesting article
here from X-bit Labs.
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But when you come to think of it, many people are now transitioning to new large models from either 19" models with 1280x1024 resolution or from CRT monitors. Let's take a transition from a 19" LCD to the above-mentioned 215TW: the horizontal resolution has increased by a third (from 1280 to 1680 pixels), which means you have to shift your mouse farther to move its pointer from one edge of the screen to another - if the mouse settings have remained the same. That's where the feeling of "slow pointer" comes from. You can get the same feeling on your current monitor by lowering the pointer speed in three times in the mouse driver's settings.
It's the same with the failure to hit the buttons on the new monitor. Our nervous system is too slow to catch the pointer-above-the-button moment with the eyes and transfer a nervous impulse to the finger that presses on the mouse's left button before the pointer leaves the button. So, the accuracy of hitting the buttons is in fact reduced to a repetition of learned movements when the brain knows beforehand what movement of the hand corresponds to a specific movement of the pointer and with what delay the command to the finger should be sent so that the pointer was exactly above the necessary button when the finger presses the mouse. Of course, all these learned actions become useless when the resolution and the physical size of the screen change. The brain has to adjust itself to the new conditions and you'll be indeed missing the onscreen buttons for a while until this adjustment is accomplished. But this is in no way related to the monitor's input lag. Just like in the previous experiment, you can achieve the same effect by changing the sensitivity of your mouse. If you increase it, you'll be racing past the necessary button. And if you decrease it, you'll be stopping your pointer before reaching it. But the brain will adapt after a while, and you'll again be hitting the buttons with ease.
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The input lag problem is also aggravated by two things common of all people. First, many people are inclined to search for complex explanations of simple things. They prefer to think that a light dot in the sky is a "flying saucer" rather than an ordinary weather balloon or that the strange shadows in the NASA photographs of the Moon are proof that men have never landed there rather than are indicative of the unevenness of the moonscape. Any person who's ever taken an interest in the activities of UFO researchers and other folks of that kind will tell you that most of their alleged discoveries are the result of thinking out excessively complex theories instead just looking for simple, earthly explanations of phenomena.
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Here's my conclusion to this section:
A) There is indeed an input lag on some monitors. The maximum value of the lag that I've seen in my tests is 47 milliseconds
B) A lag of this value cannot be noticed at ordinary work or in movies. It may make a difference in games for well-trained gamers, but wouldn't matter for most other people even in games.
C) You may feel discomfort after changing your monitor with a model that has a larger diagonal and resolution due to low speed or sensitivity of your mouse, low speed of your graphics card or due to the different size of the screen. However, many people read too much of forums and are inclined to blame the input lag as the cause of any discomfort they may feel with their new monitor.
Cutting it short, the problem does exist theoretically, but its practical effect is greatly overstated. An absolute majority of people won't ever notice a lag of 47 milliseconds, let alone smaller lags, anywhere.