a) saves money on furniture and real estate costs (visible on the bottom line; productivity losses aren't)
b) provides for free a panopticon under which your boss knows where you are and what you are doing, or can at least ask your coworkers and expect them to point you out to him
Surveillance is a useful tool for sucking surplus value from our minds. Open offices make ordinary workers (slackers) uncomfortable because of constant surveillance by management, but work isn't about making workers content. Work is about dominating workers so they produce.
An added benefit of the panopticon pen is that it's harder for devs to slack, sabotage, and organize. A watched worker is an easily controlled worker.