> let toto y =
>  let id x = x in
> id id y ;;
> 
> this will be of type 'a ->'a
> What is the difference with this :
> 
> let toto = let id x = x in id id ;;
> 
> I thought caml will understand that there is no difference !
> 
> why does caml make this difference ?

the same examples, rewritten:

let id = fun x -> x ;;

let toto = fun y -> id id y ;;

caml: ha, I know the answer to this one : toto is a function.
The evaluation of "fun y -> anything" can not create references,
so type variables can safely be generalized.

let toto = id id ;;

caml: hmmm, I wonder what this toto may be... It is the result
of an application, and I don't know whether I am qualified to
look deeper into the code to check about that.  It might be
anything, I'd better not generalize variables.

About this algorithm, you can think of Caml as of 
Winnie-the-Pooh : it can answer difficult questions in the 
particular cases where the answer is obvious (ie, syntactic). 
Otherwise it doesn't know.

Pascal