Some of the many reasons:

1) inertia - that's how it's always done;

2) it's easier to make your good employees work harder than it is to recruit more of those difficult to recruit developers;

3) they would rather you work more hours than you already do - not fewer - after all they make money hiring you, they can make more money if you work more (in some twisted linear productivity logic);

4) some people wouldn't be interested, they don't want to work shorter hours and earn less money, and that reduces the opportunity for discussing this / rolling it out;

5) understanding how productive developers are is very difficult - did that bug take a week to fix because it was challenging or because you were slacking;

6) larger teams are less productive than smaller teams.