When typing let rec expressions, the compiler 'approximates' the type of each binding, allowing it to use information about each binding during typechecking. For instance, in a let rec of functions, it knows the arity of each definition early, allowing it to produce partial application warnings for mutually recursive functions.

Currently, type annotations on function parameters are ignored during this approximation. This delays typechecking errors, often in a confusing way. This patch makes approximation use these type annotations. As well as improving errors, this also makes type-based disambiguation work in more cases, for instance:

module M = struct type t = A | B end

let rec f () = g A
and g (x : M.t) = f ()

With this patch, the above typechecks, because the compiler knows that g accepts M.t before typing the body of f.