A company called Atlassian have been experimenting with allowing their engineers 20% of their time to work on free or non-core projects (a la Google). They said:
You see, while everyone knows about Google's 20% time and we've heard about all the neat products born from it (Google News, GMail etc) – we've found it extremely difficult to get any hard facts about how it actually works in practice.
So they started with a list of questions they wanted to answer through their experiment, and they've been blogging about it at http://blogs.atlassian.com/developer/20_percent_time/. It makes for interesting reading, and it's great to see some real evidence starting to emerge.
Hat tip: Tech-Ed Collisions.