The latest issue of Usability News has two studies on the use of white space.
The first looks at the effects of contrast and density on when visually searching for an item on a Web page; the results found that contrast may not be the best visual separator. The second study, of more interest to me, was on how reading performance was affected by the size of the margins surrounding the single column of text. The study found that the layout with more white space took longer to read, but its text was better understood. Although the white space between the lines (i.e., leading) had no effect of the speed or level of comprehension, the layouts using more leading were preferred.