bearisgray

Some reasons for using a 1/4 inch seam allowance instead of a 1/2 inch seam allowance:

For most closely woven cottony fabrics that the seams will not be exposed, there simply is no need for that extra fabric. The fabric will not pull apart. Notice that I said closely woven. Also slippery fabrics like satins need to have extra seam allowance or the raw edges need to be encased (bound or use a French seam) or overcast so the edges do not fray.

It takes a lot less fabric .

It just gets bulky and harder to handle - especialy when using small pieces in a block. Even using smaller seam allowances, some quilt blocks end up with a big "clump" at some of the intersections.

However - I do have a quilting book that uses wider seam allowances - don't remember if they are 1/2 or 5/8 .

As others have said, you can take the "finished" size of a piece and add 1/2 inch all the way around.
The "finished" size is what shows "on the top" when the item is completed.

I have seen some hand-pieced blocks that the seam allowance is a scant 1/8 inch. I think that is skimpy.

The smaller seam allowances probably came about when people had only scraps to work with and they wanted to get as much "mileage" out of the pieces as possible.