An algorithm for hierarchical network design

This paper considers the network design problem of locating a set of concentrators which serves a set of customers with known demands. The uncapacitated facility location model is applied to locate the concentrators. Then, for each concentrator, a topological optimization of its subnetwork based on a simple heuristic is analyzed. In a third phase, the last model to solve the upper level subnetwork connecting the concentrators to a root node is applied. Computational results are reported for three medium-sized cities.