In this article we investigate from the point of view of spectral theory the problem of relaxation to thermodynamical equilibrium of a quantum harmonic oscillator interacting with a radiation field. Our starting point is a system of infinitely many Pauli master equations governing the time evolution of the occupation probabilities of the available quantum states. The system we consider is derived from the evolution equation for the reduced density operator obtained after the initial interaction of the oscillator with the radiation field, the latter acting as a heat bath. We provide a complete spectral analysis of the infinitesimal generator of the equations, showing thereby that it generates an infinite-dimensional system of hyperbolic type. This implies that every global solution to the equations converge exponentially rapidly toward the corresponding Gibbs equilibrium state. We also provide a complete spectral analysis of a linear pencil naturally associated with the Pauli equations. All of our considerations revolve around the notion of compactness, more specifically around the existence of a new compact embedding result involving a space of sequences of Sobolev type into a weighted space of square-integrable summable sequences.