Final answer:
False, the knowledge, skills, and abilities of employees represent human capital, not structural capital.
Human capital impacts economic growth significantly, as it improves productivity when combined with physical capital and technology. Education, skills, and training are crucial elements of human capital.
Step-by-step explanation:
The knowledge, skills, and abilities of employees is actually an example of human capital rather than structural capital, so the statement is false.
While structural capital is concerned with the institution's supportive infrastructure, processes, and databases that enable human capital to function, human capital is specifically about the employees and their capabilities which contribute to the productivity and efficiency of an organization.
Investing in human capital through education, training, and healthcare can have a significant impact on economic growth.
For instance, workers with a higher level of education and skills are often more adept at creating technological innovations which in turn can enhance production when coupled with physical capital and existing technology.
Moreover, it is important to recognize that labor, human capital, and physical capital are most effective when they work together synergistically.
This combination is essential for the robustness of an economy and for the successful application of the aggregate production function.
In an example, post-World War II Europe witnessed a swift reconstruction and enhancement of productive capacity by leveraging skilled workers and technological knowledge despite the loss of physical capital and a devastating impact on the human population.