> Complicating this picture is shells. For a long time, many shells have kept track of a name for their current directory themselves, often materializing this in the '$PWD' environment variable. The shell has to keep track of this name as a text string or the rough equivalent, which makes it potentially less accurate than the kernel's version. However, it has some advantages, because unlike the kernel, the shell knows what name you typed in order to get to the directory, which may not be the actual filesystem name of the directory because of things like symbolic links. Shells often use this knowledge so that names like '..' and even '.' work on the text version, not the filesystem version.

Related reading: Lexical File Names in Plan 9 or Getting Dot-Dot Right (https://9p.io/sys/doc/lexnames.html)