Which of the following entails understanding how wages and benefits affect employee motivation?

Compensation Theory is the correct answer because it focuses on the relationship between wages, benefits, and employee motivation. This theory posits that competitive compensation packages can enhance employee satisfaction, increase motivation, and improve organizational performance. By understanding how different forms of compensation, both financial and non-financial, influence employee behavior and attitudes, organizations can develop strategies that motivate their workforce effectively.

Employee Engagement is related to how committed and involved employees are in their work but does not specifically focus on wages and benefits as primary motivators. Job Design involves structuring job roles in a manner that enhances job satisfaction and productivity, but it also does not directly address how compensation impacts motivation. Organizational Behavior studies how individuals and groups interact within an organization, encompassing a broader range of factors beyond just compensation and benefits. Thus, Compensation Theory is specifically tailored to examine the impact of monetary and non-monetary rewards on motivation, making it the most relevant choice in the context of the question.