This is a matrix corresponding to the SUPG discretisation of an advection-diffusion operator. This demo is based on a function by Mark Embree, which was essentially distilled from the IFISS software of Elman and Silvester. See: http://www.ma.umist.ac.uk/djs/software.html and [1].
For this example, whilst the eigenvalues computed by eigs are inaccurate due to the sensitivity of the problem, the approximate pseudospectra are very good approximations to the true ones.
[1]: B. Fischer, A. Ramage, D. Silvester and A. Wathen, "Towards Parameter-Free Streamline Upwinding for Advection-Diffusion Problems", Comput. Methods Appl. Mech. Eng., 179, 1999, 185-202.
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