Psychology is the study of human behaviour in society while public administration is the study of human action. Psychology is the guide of Public Administration while it proceeds to frame a public policy. Action is motivated by a person’s psychological behaviour; evidently psychology and public administration are closely related.
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Today, administration is being increasingly studied from the psychological point of view. Taking human activities as perfectly rational, the early writers of public administration proceeded to discover immutable laws of organization and management for the guidance of administration.
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But now they have found out as a result of psychological studies that human is not entirely rational. Sometimes his behaviour is influenced by non-rational considerations such as his like and dislikes, fear or love.
This has brought about a radical change in the study of public administration. The most important result of the psychological approach has been the recognition of the fact underlying every formal organization.
There also exists an informal organization which springs up from the personal relationships and attitudes of the personnel engaged in running the administration. Thus it has been felt that an organization can work successfully only if there exists mutual sympathy and goodwill between its head and his lieutenants.
In addition to it, psychology has added a number of topics which the student of public administration has to study, for example, the problems of morale, incentive and prestige. In the selection of personnel, psychological tests are being increasingly used.
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Arrangement for consultation with staff through committees, devices like Whitely Councils for resolving disagreements between the employer and the employees, increasing attention to public relations are all based on the recognition of the importance of the proper psychological relationships between the various parties to the administration.