This seems to be a bug, because you see all over the place recommendations to use
\documentclass{report}
\usepackage{pgfplots}
\pgfplotsset{compat=1.18}
\begin{document}
\begin{tikzpicture}[scale=0.7]
\begin{axis}[
domain=0:4,
samples=30,
smooth,
axis lines=center,
xlabel={$K$}, ylabel={$L$}, zlabel={$f(K,L)$},
xmin=0, xmax=5, ymin=0, ymax=5, zmin=0, zmax=5,
view={80}{30},
colormap/blackwhite
]
% Define the function to plot
\def\f(#1,#2){#1^0.5 * #2^0.5}
\addplot3 [surf] {\f(x,y)};
\end{axis}
\end{tikzpicture}