[Victor Maxus]

Well, you are a thief, you want to make yourself as light and quiet as possible. Packing a small weapon allows this. Also, when moving around, easier to manuever a dagger or knife in a close in situation, making it more practical. Finally, the short range, believe it or not, may just help. You can cover targets mouth when stabbing him to keep him quiet and place your blade in his back at the same time. Easier to do with a short blade than a long sword.

I don't know if any of my reason make sense or hold true, but just trying to do a half hearted attempt to come up with some sort of explanation on this.