Level Caps

These are some quick thoughts about level caps for non-human races. A lot of people hate them because they feel they are arbitrary; on the other hand, dwarves, elves and halflings start out better than humans at first level, so Gygax felt a need to balance them by not letting them progress as far.

The arbitrary feeling goes away a bit if you also cap humans to a maximum level. Non-human races can be capped relative to humans:

• dwarves save as four levels higher than actual, so level cap is Human - 4.
• elves are both fighters and magic-users, so max fighter level + max MU level should equal max Human level.
• halflings are basically Dwarves (save as four levels higher) but with a bonus ability of disappearing in plain sight. Since Invisibility is a 2nd level spell, cap Halflings at Dwarf - 2.
• variant halflings are other little people with an innate magical ability other than Invisibility. Pixies can fly; sure, they have wings, but treat that as having an innate Fly spell (3rd level,) so they are capped at Dwarf - 3. Likewise, Nixies have Waterbreathing and are also capped at Dwarf - 3. If I wanted to define Spriggans as "little people who can magically grow to giant size," basically a variant of Animal Growth that only affects themselves, but allows more than double size, so make it a 4th level ability and cap Spriggans at Dwarf - 4.
• gnomes are variant halflings, but with no special ability, unless you want to count "speak with burrowing creatures" as a limited version of Speak with Animals (normally 2nd level.) They do have a link to illusions, however, which can either be handled as split Fighter/Illusionist the same way elves are handled, or give them innate improved Phantasmal Force (3rd level instead of 2nd.) x
  

The actual caps are close to the assumption that humans are capped at level 12, so I'd just adjust other level caps to fit with a human level cap of 12:

• Dwarves can reach a maximum of 8th level.
• Elves can reach a maximum of 4th level as fighter and 8th level as magic-user.
• Halflings can reach a maximum of 6th level.
• Pixies, Nixies can reach a maximum of 5th level.
• Spriggans can reach a maximum of 4th level and grow to the size of an ogre or giant of (4 + spriggan's HD.)
• Gnomes can either be innate illusionists (maximum 4th level) or a maximum of 3rd level as a fighter and 4th level as an illusionist.
  

Raising human level caps should raise level caps for other races. Alternatively, drop level caps, but make non-humans earn extra experience equal to the level differences above (a 1st level halfling has to earn enough experience equivalent to 8th level in order to advance to 2nd.) If you're a nice GM, you can spread the extra experience required over a range of levels.