What is the reasoning behind the reputation cap?
It seems having a limit on reputation encourages people to not try and earn as much reputation as possible per day.
Is there a particular reason for this limit?
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Because it's not about earning reputation, it's about helping to build an awesome resource.
Earning rep and badges is fun, but it can't be the most important thing, or we'd attract too many people for whom the gamified part was the only thing. By limiting the amount of rep you can get in a day, we allow the contributions of the people who really care about helping to outweigh contributions from people who just want to be in a gigantic... flag... waving contest.