Question

How does studying consumer behavior theory benefit public administration?

Answer 1

as far as i can remember its basically for policy considerations. if you raise or lower a tax will it affect how the item or good is purchased and how far up or down will the equilibrium move. and you can use it to estimate the tax gain from a good or market and the share of the burden that the supplier and the consumer bear

Answer 2

If you are studying to become a public bureaucrat or policy wonk, it is very important that you understand the economic implications of policies that you will devise. Most social policies have very big economic impact, and so you need to understand how they will affect the individual consumer. Theory of consumer behavior is just that, a theory, but as long as you don't take every thing very literally, you'll find that it is very applicable and useful for a lot of policy decisions.