Here’s an argument from the Economist which suggests that productivity increases by letting employees work from home (emphasis mine):
But tethering the Yahoos to their stalls in the company’s offices does not seem like the right way to go about boosting their output. Plenty of evidence suggests that letting employees work from home is good for productivity.
The premises seem to be:
1. Letting employees work from home boost productivity
2. If one worker works from and productivity increases then as more workers work from then productivity will increase more
Conclusion: All workers should work from home.
More coverage here - my read is that while working from can have productivity gains these gains are not monotonic. At some point there will be negative returns and Yahoo may have gone well past those gains into negative territory. The reason for the ban is perhaps to have a clean slate. Let’s start all over and then begin doling out work from home perks as time progresses. After all if the Economist is correct, Yahoo should be swimming in profits.