I actually had an interview where I not only had to code the solution on the whiteboard but the developers then gave me parameters that they wanted passed in and I had to execute the function in my mind and give the correct output of the function.
That's what efficient developers do. Relying on the compiler/interpreter for seeing if an algorithm works is a crutch. Mentally stepping through an algorithm, including keeping track of the state of e.g. state variables or stacks, is a litmus test to see if you really understand the code you just wrote.
(preemptive nitpicker rebuke: getting the exact numeric output if that output depends on calculating e.g. the root of 34252 in your head is not what I mean by this)
