The db_cache_size initialization parameter (formerly db_block_buffers) governs the size of the RAM data buffer cache region.

Oracle has the v$db_cache_advice utility to determine the marginal benefit (in terms of reducing disk reads) by adding more data cache.

Staring in Oracle9i we also have separate database cache size parameters for multiple blocksizes, including db_nk_cache_size.  Some experts say that Oracle indexes should be removed from db_cache_size and moved into the db_32k_cache_size region to build cleaner tree structures and reduce I/O for index range scans.

It is important to remember that there are downsides to having a super-large db_cache_size. While direct access to data is done with hashing, there are times when the database must examine all of the blocks in the RAM cache.

• Systems with high Invalidations – Whenever a program issues a truncate table, uses temporary tables or runs a large data purge, Oracle must sweep all of the blocks in the db_cache_size to remove dirty blocks. This can cause excessive overhead for system with a db_cache_size greater than 10 gigabytes.
   

• High Update Systems – The database writer (DBWR) process must sweep all of the blocks in db_cache_size when performing an asynchronous write. Having a huge db_cache_size can cause excessive work for the database writer.
   

• RAC systems – Systems using Oracle9i RAC may experience high cross-instance call when using a large db_cache_size in multiple RAC instances. This inter-instance “pinging” can cause excessive overhead, and that is why RAC DBA’s try to segregate RAC instances to access specific areas of the database.

The Ion tool plots the historic usage of your db_cache_size: