Interfacility Interaction in Models of Hub and Spoke Networks

20 Pages Posted: 14 Dec 2002

See all articles by Morton E. O'Kelly

Morton E. O'Kelly

Ohio State University (OSU) - Geography

Deborah Bryan

Texas State University, San Marcos - Department of Geography

Abstract

Providers of transportation services may reduce their average unit costs by bundling flows and channeling them between hubs (also known as concentrators or routers). The resulting facility locations are interdependent because of the flows between them. This paper analyzes mathematical models of hub systems in an effort to enhance understanding of the optimal location of interactive facilities. The paper examines the behavior of solutions to several alternative models that require the location of a hub at either of two similar locations. A model employing a concave cost function favors the assembly of flows, penalizes fractional facility locations, and produces local minima that have integer facilities.

Suggested Citation

O'Kelly, Morton E. and Bryan, Deborah, Interfacility Interaction in Models of Hub and Spoke Networks. Journal of Regional Science, Vol. 42, pp. 145-164, 2002. Available at SSRN: https://ssrn.com/abstract=309249

Morton E. O'Kelly (Contact Author)

Ohio State University (OSU) - Geography ( email )

1036 Derby Hall
154 North Oval Mall
Columbus, OH 43210
United States

Deborah Bryan

Texas State University, San Marcos - Department of Geography ( email )

United States

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