This statue depicts Pan teaching Daphnis how to play the Pan flute. Pan was once chasing the nymph Syrinx, who flew to the river Ladon and transformed herself into a reed. Pan broke the reed into peaces and tied them together to the flute and named it Syrinx. It so became the flute of the shepherds.

Source: http://www.flickriver.com/photos/mharrsch/1690023097/
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