It is two gain controls in opposition, supplying one of the three cues your ears use to place a sound — which explains both what panning is good at and everything it cannot do.
Turn a pan pot and a sound appears to move between your speakers. Nothing has moved. Nothing is even pretending to move, in any physical sense — and knowing exactly what the control does explains both what panning is unusually good at and the specific things it will never do.
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