Single-assignment hub location problems with multiple capacity levels

In this paper, an extension of the classical capacitated single-allocation hub location problem is studied in which the size of the hubs is part of the decision making process. For each potential hub a set of capacities is assumed to be available among which one can be chosen. Several formulations are proposed for the problem, which are compared in terms of the bound provided by the linear programming relaxation. Different sets of inequalities are proposed to enhance the models. Several preprocessing tests are also presented with the goal of reducing the size of the models for each particular instance. The results of the computational experiments performed using the proposed models are reported.