2 files changed, 42 insertions, 12 deletions

diff --git a/lib/compress.js b/lib/compress.js
index 1f710f10..345a414a 100644
--- a/lib/compress.js
+++ b/lib/compress.js
@@ -1420,7 +1420,7 @@ merge(Compressor.prototype, {
                 drop_funcs = drop_vars = true;
             }
             var in_use = [];
-            var in_use_ids = {}; // avoid expensive linear scans of in_use
+            var in_use_ids = Object.create(null); // avoid expensive linear scans of in_use
             if (self instanceof AST_Toplevel && compressor.top_retain) {
                 self.variables.each(function(def) {
                     if (compressor.top_retain(def) && !(def.id in in_use_ids)) {
@@ -1514,11 +1514,17 @@ merge(Compressor.prototype, {
             // pass 3: we should drop declarations not in_use
             var tt = new TreeTransformer(
                 function before(node, descend, in_list) {
+                    if (node instanceof AST_Function
+                        && node.name
+                        && !compressor.option("keep_fnames")
+                        && !(node.name.definition().id in in_use_ids)) {
+                        node.name = null;
+                    }
                     if (node instanceof AST_Lambda && !(node instanceof AST_Accessor)) {
                         if (!compressor.option("keep_fargs")) {
                             for (var a = node.argnames, i = a.length; --i >= 0;) {
                                 var sym = a[i];
-                                if (sym.unreferenced()) {
+                                if (!(sym.definition().id in in_use_ids)) {
                                     a.pop();
                                     compressor.warn("Dropping unused function argument {name} [{file}:{line},{col}]", {
                                         name : sym.name,
@@ -2145,16 +2151,6 @@ merge(Compressor.prototype, {
         return self;
     });
 
-    OPT(AST_Function, function(self, compressor){
-        self = AST_Lambda.prototype.optimize.call(self, compressor);
-        if (compressor.option("unused") && !compressor.option("keep_fnames")) {
-            if (self.name && self.name.unreferenced()) {
-                self.name = null;
-            }
-        }
-        return self;
-    });
-
     OPT(AST_Call, function(self, compressor){
         if (compressor.option("unsafe")) {
             var exp = self.expression;
diff --git a/test/compress/drop-unused.js b/test/compress/drop-unused.js
index 5620cf40..5a09c6cd 100644
--- a/test/compress/drop-unused.js
+++ b/test/compress/drop-unused.js
@@ -556,3 +556,37 @@ drop_toplevel_keep_assign: {
         console.log(b = 3);
     }
 }
+
+drop_fargs: {
+    options = {
+        keep_fargs: false,
+        unused: true,
+    }
+    input: {
+        function f(a) {
+            var b = a;
+        }
+    }
+    expect: {
+        function f() {}
+    }
+}
+
+drop_fnames: {
+    options = {
+        keep_fnames: false,
+        unused: true,
+    }
+    input: {
+        function f() {
+            return function g() {
+                var a = g;
+            };
+        }
+    }
+    expect: {
+        function f() {
+            return function() {};
+        }
+    }
+}