In theory, they limit self promotion so that people actually participate in the community, and don't just use it as a link dump. The ideal is that people discuss other topics more often, and share their own work only every so often.
A lot of forums and chat servers have similar rules for the same reason.
Unfortunately, this doesn't work very well on Reddit, since the smarter advertisers and astro turfers have figured out how to manipulate the system well enough that people don't suspect they're advertising.
Add this to how certain types of low effort content get a ton of upvotes anyway, and how popular creators don't need to care since their fans will promote them anyway, and well, the end result is less "participate in the community" and more "don't be unpopular or bad at pretending to be someone else"
Hacker News doesn't block self promotion. You are free to post your own stories linking to your own work, I've done it, people do it all the time. There's a whole section for it, 'Show HN' (although it's not required to post there). And you're free to post links to your work in comments when relevant.
Of course spam is unwelcome everywhere. Don't overdo it and don't be deceptive about it, and you'll be fine.
As a Reddit mod, I block most self-promotion because honestly it's mostly trash posted by people with no interest in the community.
These posts are almost always of low quality and designed to hook gullible people, and much of it driven either by influencers or sellers of snake oil. It's not just legit promotional posts, either; there's plenty of astroturfing trying to post recommendations for products etc. Even so I bet a lot goes under my radar.
In a very few cases I have allowed a promotional post when I have been convinced that it was for a good purpose. I support genuine entrepreneurs who look like they're building something of value. But those are extremely rare on Reddit. All of Reddit is rather bleak in that regard. So much content stealing, influencing, astroturfing, link farming, and outright spam.
As mentioned repeatedly, HN doesn't block self-promotion.
But reddit something else entirely. It so clear that all of the major subs are constantly being manipulated by firms working PR for large companies, but the second someone posts "I made this!" people get up-in-arms.
Of course who really knows how much of reddit is even real people anymore.
"Hey, look at a thing I made!" is a lot more interesting than a lot of the other drivel that gets posted.