I have seen many behind-the-scenes photos that depict a large diffused light source (like a LastoLite Skylite Rapid) placed above model's head. Imagine it is like a ceiling.
What is this done for? What kind of look and effect does it make?
Don't think of it as a light source, but as a shade source.
There are, of course, reasons why a photographer might want to use an overhead light source, but your question didn't mention anything other than the panel. That leads me to believe that you are referring to location fashion, glamour and beach bunny shots of the sort that make their way into magazines.
Since they normally involve a lot of lead time, the photos are often taken in some exotic location so the the printemps/ete collection doesn't look like it was shot in the middle of winter. That involves sending a lot of expensive people off on an expensive trip, and you certainly don't want them lazing about enjoying a nice vacation while they wait for the golden hour. Or they may be shot more locally and closer to the time of publication, but still with some time constraints.
Those time constraints mean a lot of midday shooting under clear skies. Normally, that would mean a lot of harsh, unflattering shadows and raccoon eyes. Any amateur photographer worth his or her salt would turn up his or her nose at the task and come back when the light is more suitable. The pro needs to get the shot now, not tonight or tomorrow morning. The schedule is already tight, and there are other things to be shot then. Or maybe the flight out is in a few hours. Or the location will be full of tourists after 4 o'clock. Or you'll have to light the background cliff-side with 20,000 watt-seconds of flash from thirty heads at a different time of day.
An overhead silk, whether that be something as small as medium or large Skylite or Scrim Jim, or something as large as a "real" overhead (12 x 12 feet), prevents harsh overhead lighting, while still giving a hint of directionality to match the surroundings. If you use a heavier silk, like a two-stop, you're left with light coming from the sky at a more flattering angle without adding anything else, and you can bounce light back in (or use a flash) to achieve the modelling and kickers you want without having to light as extensively as you would have had to if you had used an opaque panel.
So it's not about achieving one effect nearly as much as it is about relieving another. You're shooting a model in harsh overhead sunlight: what are you going to do about it?