We investigate the two-photon scattering properties of a Jaynes-Cummings (JC) nonlinearity consisting of a two-level system (qubit) interacting with a single mode cavity, which is coupled to two waveguides, each containing a single incident photon wave packet initially. In this scattering setup, we study the interplay between the Hong-Ou-Mandel effect arising due to quantum interference and effective photon-photon interactions induced by the presence of the qubit. We calculate the two-photon scattering matrix of this system analytically and identify signatures of interference and interaction in the second order auto- and cross-correlation functions of the scattered photons. In the dispersive regime, when qubit and cavity are far detuned from each other, we find that the JC nonlinearity can be used as an almost linear, in-situ tunable beam splitter giving rise to ideal Hong-Ou-Mandel interference, generating a highly path-entangled two-photon NOON state of the scattered photons. The latter manifests itself in strongly suppressed waveguide cross-correlations and Poissonian photon number statistics in each waveguide. If the two-level system and the cavity are on resonance, the JC nonlinearity strongly modifies the ideal HOM conditions leading to a smaller degree of path entanglement and sub-poissonian photon number statistics. In the latter regime, we find that photon blockade is associated with bunched auto-correlations in both waveguides, while a two-polariton resonance can lead to bunched as well as anti-bunched correlations.
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