[aercolino]

If you want to see how they code, why do you want to see their own algorithm? In normal conditions, They would Google the problem and find its algorithm on Wikipedia (with lots of additional information to peruse) and some interesting implementations on stackoverflow (both to choose from and to learn about related issues).

Programming in the wild has very little to do with knowing beforehand or being able to invent on the spot an algorithm.

But the real reason why software engineering interviews are being done that way is because programming is not perceived as an art anymore. Engineers' scope inside the company was greatly reduced, while their number increased. They are now commodity workers: Not only they must be replaceable, but also expanded and shrunk as soon as possible, much faster and cheaper than before.