There is no reason in my opinion to EVER dock a dog's tail and it has been outlawed as inhumane in many countries, but unfortunately the yorkie breed standard as set forth by the YTCA requires a docked tail.
In my opinion it is an archaic part of the standard that needs to be removed. These dogs have beautiful tails when they are left alone.
I would never understand docking a tail unless it is a show dog and even then, I think it's a shame.