interesting question. I can only say that all nouns are capitalized, whereas German does not capitalize "ich" ("I"), for instance.
Here some research results:
QUOTE
In German, all nouns and noun-like words are capitalized. This was also the practice in Danish before a spelling reform in 1948. It was also done in 18th century English (as with Gulliver's Travels and most of the original 1787 United States Constitution). Luxembourgish, a close relative of German and one of the three official languages of Luxembourg, also still uses capitalization of nouns to this day.
Some other source says that the capitalization in German started in the Late Middle Ages, first in Latin texts, and, from the 14th century on, in German ones, too. Back then, it became custom to show the importance of certain terms (back then not only nouns, though) by visually enhancing them - by starting those words with majuscules. Could be the first letter, but also first and second. This often was for instance done in religious texts, where the word Gott (god) could for instance be written as "GOtt". Over the years, things developed, limiting it to one capital letter only, for every noun. Apparently, this approach was later also chosen in other countries, for instance in Denmark (see first quote) and then, with the union of Denmark and Norway (1521 - 1814), even in Norway. Norway abandoned it again in 1869.
There have been various phases in Germany where it was heavily discussed to abandon the capitalization of nouns as well (last in 1996-2000, where various other rules were changed), but it was always decided against. Supporters of the capitalization claim it makes texts more easily readable for German readers, and the non-supporters claim this to be a false assumption, and point out that capitalization is a huge source of spelling errors.
QUOTE
Although Kleinschreibung had its advocates, the framers of the 1996 German spelling reforms felt it was simply not politically feasible to call for the elimination of noun capitalization. As it was, they had quite enough controversy without adding Groß- und Kleinschreibung to the list.
In a way, leaving the noun-capitalization rule largely untouched was a good thing for students of German. It certainly makes it easier to spot a noun (das Substantiv, das Hauptwort) in German, something that many students find difficult to do in their own language! The rules for capitalization in German are in fact no more complicated than those for English or most other languages, but there are some differences that a student of German should be aware of. These differences can be a source of interference problems for someone learning German.
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I so should've known Norway used to this, too!
