Imagine solving a riddle, such as the one shown in the following image, with multiple constraints in the form of hints. You resolve the constraints to derive the answer. You can compare type inference to generating constraints and then resolving them, in order to determine the data types in a programming language. Type inference is the capability of the compiler to determine the type of the data, by using the information that is already available in the code—literal values, method invocations, and their declarations. For a developer, type inference reduces verbosity, as indicated by the following diagram:
For your reference, the answer to the preceding riddle is 87 (just turn the image upside down, and you'll find the numbers in a sequence).