The call-by-value language RML may be viewed as a canonical restriction of Standard ML to ground-type references, augmented by a “bad variable” construct in the sense of Reynolds. We consider the fragment of (finitary) RML terms of order at most 1 with free variables of order at most 2, and identify two subfragments of this for which we show observational equivalence to be decidable. The first subfragment, RMLP−Str2⊢1, consists of those terms in which the P-pointers in the game semantic representation are determined by the underlying sequence of moves. The second subfragment consists of terms in which the O-pointers of moves corresponding to free variables in the game semantic representation are determined by the underlying moves. These results are shown using a reduction to a form of automata over data words in which the data values have a tree-structure, reflecting the tree-structure of the threads in the game semantic plays. In addition we show that observational equivalence is undecidable at every third- or higher-order type, every second-order type which takes at least two first-order arguments, and every second-order type (of arity greater than one) that has a first-order argument which is not the final argument
