I read something like this from a game business book, which I don't remember the title anymore (sorry it's been a while. If anyone let me know, I'll update this post):
"If you don't have a budget for free T-shirts for employees, make one. If you do, double it up"
I totally agree. From company's point of view, this is a really cheap way to show it cares about people and keep morale high. Don't forget that people become happy or pissed off by mostly small things. So if you are in a position to make a decision on free swags, please get each of your employees at least one free T-shirt an year.
It's also very interesting to see how high morale can affect the quality of games. Throughout my career, I have seen plenty of game developers who did more than what they were asked for when they were given free T-shirts, thus excited. Of course, I also saw the opposite: the sweat-shop game developers who did never more than what they were required just because they were treated like factory workers. Actually, seeing the latter more often nowadays, I'm a bit worried.
To me, game making is a form of art + technology collaboration. So more excited your developers are, more inspiration they offer to their colleagues, which means more iterations = better games. If you don't trust me, maybe you can ask how many free T-shirts each employees get at your favorite game studios... :)