Incremental compilation means that the compiler inspects your code, determines which parts of the application are affected by your changes, and only recompiles the newer files. Incremental compilation can help reduce compile time on small applications, but you achieve the biggest gains on larger applications. The default value of the incremental compiler option is true for most tools.
While recompiling , Incremental compilation does less work than full recompile. The simulation doesn't show any difference , only the compilation time is reduced. Imagine you are working with hundreds of files and U just changed one file, During full recompilation , all the files are recompiled, where in incremental compilation , only the file which is changed and the files which are dependent on changed files are compiled and linked to the already compiled database.