I think we capitalize the proper nouns because we want them to stand out more on the page, and we also want to accord proper nouns a certain amount of respect and attention. When we look at the word "house," for example, there is no good reason to call special attention to it, but if we have a title like "Chicago Settlement House," we want to give it the extra attention accorded to a particular place. Capital letters make a word stand out much more easily, certainly. In looking at directions, when we capitalize the name of a street, it stands out more for the reader. Another example is the word we often use for a mother. That is a generic term, for any mother, but in dialogue, we write like this:
I see, Mom, how proud you are of me.
Otherwise I would write this:
My mom is proud of me.
So there is some importance, some respect, and some special attention involved.
"Noun" is the designation for a grammatical concept, a type of word. A noun is generally described as a "person, place, or thing," but it also includes ideas, such as democracy. Verbs designate action words but nouns are the entities that do the actions or have the actions done to them.
There are two types of nouns: common nouns and proper nouns. Common nouns are the kinds of nouns that are in the sentences of this answer, e.g., words such as "noun," "concept," "type," and "word." These are generic. There are many nouns, many concepts, many types of things, and very many words!
Proper nouns, in contrast, designate specific things or ideas. You can have a city (common noun) or you can have "New York," which is a specific city and a proper noun. There can be a person, or you can have "Barak Obama," as a specific person and also a proper noun.
Proper nouns, as can be seen from the examples above, are the type of nouns that are capitalized always.
http://www.chompchomp.com/terms/propernoun.htm
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