This paper reports finite-element simulations of drop deformation in converging flows in an axisymmetric conical geometry. The moving interface is captured using a diffuse-interface model and accurate interfacial resolution is ensured by adaptive refinement of the grid. We have explored the effects of viscoelasticity on drop deformation when either the drop or the matrix is a Giesekus fluid. Contrary to the popular belief that viscoelasticity in the drop hinders deformation and that in the matrix enhances deformation, we predict a more complex picture in which viscoelasticity in either component may suppress or promote drop deformation depending on the capillary number Ca and the drop-to-matrix viscosity ratio . Smaller Ca and  are conducive to the behavior mentioned above, while large Ca and  may produce the opposite effect. Both trends are explained by the reaction of the polymer stress to the inhomogeneous and transient deformation in the converging flow field. Finally, this understanding reconciles contradictory results in the literature as opposite limits in the parameter space.
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