Recursive template with knockout js

Yes KnockOut supports recursive templates so you can reference and render the same template inside the template.

An example html in your case would look like this:

<script id="formElementNodeTemplate" type="text/html">
<ul>
    <li>Parent <span data-bind="text: text"></span> 
               <span data-bind="text: value"></span>
        <br/>
        Children:
        <!-- ko template: { name: 'formElementNodeTemplate',  
                            foreach: children } -->
        <!-- /ko -->        
     </li>
   </ul>
</script>    

<div data-bind="template: { name: 'formElementNodeTemplate', data: $data }">
</div>

Demo JSFiddle.