create a file ~/.config/gtk-3.0/gtk.css ( add the below CSS )
then you will need to reload gnome-shell: ALT + F2 and type r
I was able to reduce the app Titlebar on Gnome 3.20 with the following CSS:

headerbar entry,
headerbar spinbutton,
headerbar button,
headerbar separator {
    margin-top: 0px; /* same as headerbar side padding for nicer proportions */
    margin-bottom: 0px;
}

headerbar {
    min-height: 24px;
    padding-left: 2px; /* same as childrens vertical margins for nicer proportions */
    padding-right: 2px;
    margin: 0px; /* same as headerbar side padding for nicer proportions */
    padding: 0px;
  }