In the mid-1980s, social scientists compared outcome measures of related drug studies, some funded by private companies and others by nonprofit organizations or government agencies. The concept of a “funding effect” was coined when it was discovered that study outcomes could be statistically correlated with funding sources, largely in drug safety and efficacy studies. Also identified in tobacco research and chemical toxicity studies, the “funding effect” is often attributed, implicitly or explicitly, to research bias. This article discusses the meaning of (...) scientific bias in research, examines the strongest evidence for the “funding effect,” and explores the question of whether the “funding effect” is an indicator of biased research that is driven by the financial interests of the for-profit sponsor. This article argues that the “funding effect” is merely a symptom of the factors that could be responsible for outcome disparities in product assessment. Social scientists should not suspend their skepticism and choose as a default hypothesis that bias is always or typically the cause. (shrink)