The surface/volume phenomenon occurs when tasks communicate with their local neighbors only.
The communication costs are proportional to the surface size (the number of boundary nodes).
The computational costs are proportional to the volume.
Since (in two dimensions) the surface grows with N while the volume grows with N x N, communication overhead per computation decreases as the volume become larger.
Note: this effect is maximized if the block partitioning is done in many dimensions; a cube has a better (lower) surface-to-volume ratio than an oblong solid. :q