diff --git a/src/backend/optimizer/plan/createplan.c b/src/backend/optimizer/plan/createplan.c
index 8baf36ba4b7..4d059eba3f0 100644
--- a/src/backend/optimizer/plan/createplan.c
+++ b/src/backend/optimizer/plan/createplan.c
@@ -4344,6 +4344,7 @@ create_nestloop_plan(PlannerInfo *root,
 	NestLoop   *join_plan;
 	Plan	   *outer_plan;
 	Plan	   *inner_plan;
+	Relids		outerrelids;
 	List	   *tlist = build_path_tlist(root, &best_path->jpath.path);
 	List	   *joinrestrictclauses = best_path->jpath.joinrestrictinfo;
 	List	   *joinclauses;
@@ -4374,8 +4375,8 @@ create_nestloop_plan(PlannerInfo *root,
 	outer_plan = create_plan_recurse(root, best_path->jpath.outerjoinpath, 0);
 
 	/* For a nestloop, include outer relids in curOuterRels for inner side */
-	root->curOuterRels = bms_union(root->curOuterRels,
-								   best_path->jpath.outerjoinpath->parent->relids);
+	outerrelids = best_path->jpath.outerjoinpath->parent->relids;
+	root->curOuterRels = bms_union(root->curOuterRels, outerrelids);
 
 	inner_plan = create_plan_recurse(root, best_path->jpath.innerjoinpath, 0);
 
@@ -4415,7 +4416,8 @@ create_nestloop_plan(PlannerInfo *root,
 	 * node, and remove them from root->curOuterParams.
 	 */
 	nestParams = identify_current_nestloop_params(root,
-												  best_path->jpath.outerjoinpath);
+												  outerrelids,
+												  PATH_REQ_OUTER((Path *) best_path));
 
 	/*
 	 * While nestloop parameters that are Vars had better be available from
@@ -4423,32 +4425,57 @@ create_nestloop_plan(PlannerInfo *root,
 	 * that are PHVs won't be.  In such cases we must add them to the
 	 * outer_plan's tlist, since the executor's NestLoopParam machinery
 	 * requires the params to be simple outer-Var references to that tlist.
+	 * (This is cheating a little bit, because the outer path's required-outer
+	 * relids might not be enough to allow evaluating such a PHV.  But in
+	 * practice, if we could have evaluated the PHV at the nestloop node, we
+	 * can do so in the outer plan too.)
 	 */
 	outer_tlist = outer_plan->targetlist;
 	outer_parallel_safe = outer_plan->parallel_safe;
 	foreach(lc, nestParams)
 	{
 		NestLoopParam *nlp = (NestLoopParam *) lfirst(lc);
+		PlaceHolderVar *phv;
 		TargetEntry *tle;
 
 		if (IsA(nlp->paramval, Var))
 			continue;			/* nothing to do for simple Vars */
-		if (tlist_member((Expr *) nlp->paramval, outer_tlist))
+		/* Otherwise it must be a PHV */
+		phv = castNode(PlaceHolderVar, nlp->paramval);
+
+		if (tlist_member((Expr *) phv, outer_tlist))
 			continue;			/* already available */
 
+		/*
+		 * It's possible that nestloop parameter PHVs selected to evaluate
+		 * here contain references to surviving root->curOuterParams items
+		 * (that is, they reference values that will be supplied by some
+		 * higher-level nestloop).  Those need to be converted to Params now.
+		 */
+		phv = (PlaceHolderVar *) replace_nestloop_params(root, (Node *) phv);
+
+		/*
+		 * It's not actually necessary to update the NestLoopParam entry,
+		 * because the two PHVs would be equal() anyway and thus setrefs.c
+		 * would still replace the NestLoopParam's PHV with an outer-plan
+		 * reference Var.  (This is also why we needn't run
+		 * replace_nestloop_params before checking tlist_member.)  But we
+		 * might as well do it for cleanliness.
+		 */
+		nlp->paramval = (Var *) phv;
+
 		/* Make a shallow copy of outer_tlist, if we didn't already */
 		if (outer_tlist == outer_plan->targetlist)
 			outer_tlist = list_copy(outer_tlist);
 		/* ... and add the needed expression */
-		tle = makeTargetEntry((Expr *) copyObject(nlp->paramval),
+		tle = makeTargetEntry((Expr *) copyObject(phv),
 							  list_length(outer_tlist) + 1,
 							  NULL,
 							  true);
 		outer_tlist = lappend(outer_tlist, tle);
 		/* ... and track whether tlist is (still) parallel-safe */
 		if (outer_parallel_safe)
-			outer_parallel_safe = is_parallel_safe(root,
-												   (Node *) nlp->paramval);
+			outer_parallel_safe = is_parallel_safe(root, (Node *) phv);
 	}
 	if (outer_tlist != outer_plan->targetlist)
 		outer_plan = change_plan_targetlist(outer_plan, outer_tlist,
diff --git a/src/backend/optimizer/util/paramassign.c b/src/backend/optimizer/util/paramassign.c
index 9836abf9479..4c13c5931b4 100644
--- a/src/backend/optimizer/util/paramassign.c
+++ b/src/backend/optimizer/util/paramassign.c
@@ -599,38 +599,31 @@ process_subquery_nestloop_params(PlannerInfo *root, List *subplan_params)
 }
 
 /*
- * Identify any NestLoopParams that should be supplied by a NestLoop plan
- * node with the specified lefthand input path.  Remove them from the active
- * root->curOuterParams list and return them as the result list.
+ * Identify any NestLoopParams that should be supplied by a NestLoop
+ * plan node with the specified lefthand rels and required-outer rels.
+ * Remove them from the active root->curOuterParams list and return
+ * them as the result list.
  *
- * XXX Here we also hack up the returned Vars and PHVs so that they do not
- * contain nullingrel sets exceeding what is available from the outer side.
- * This is needed if we have applied outer join identity 3,
- *		(A leftjoin B on (Pab)) leftjoin C on (Pb*c)
- *		= A leftjoin (B leftjoin C on (Pbc)) on (Pab)
- * and C contains lateral references to B.  It's still safe to apply the
- * identity, but the parser will have created those references in the form
- * "b*" (i.e., with varnullingrels listing the A/B join), while what we will
- * have available from the nestloop's outer side is just "b".  We deal with
- * that here by stripping the nullingrels down to what is available from the
- * outer side according to leftrelids.
- *
- * That fixes matters for the case of forward application of identity 3.
- * If the identity was applied in the reverse direction, we will have
- * parameter Vars containing too few nullingrel bits rather than too many.
- * Currently, that causes no problems because setrefs.c applies only a
- * subset check to nullingrels in NestLoopParams, but we'd have to work
- * harder if we ever want to tighten that check.  This is all pretty annoying
- * because it greatly weakens setrefs.c's cross-check, but the alternative
+ * Vars and PHVs appearing in the result list must have nullingrel sets
+ * that could validly appear in the lefthand rel's output.  Ordinarily that
+ * would be true already, but if we have applied outer join identity 3,
+ * there could be more or fewer nullingrel bits in the nodes appearing in
+ * curOuterParams than are in the nominal leftrelids.  We deal with that by
+ * forcing their nullingrel sets to include exactly the outer-join relids
+ * that appear in leftrelids and can null the respective Var or PHV.
+ * This fix is a bit ad-hoc and intellectually unsatisfactory, because it's
+ * essentially jumping to the conclusion that we've placed evaluation of
+ * the nestloop parameters correctly, and thus it defeats the intent of the
+ * subsequent nullingrel cross-checks in setrefs.c.  But the alternative
  * seems to be to generate multiple versions of each laterally-parameterized
  * subquery, which'd be unduly expensive.
  */
 List *
-identify_current_nestloop_params(PlannerInfo *root, Path *leftpath)
+identify_current_nestloop_params(PlannerInfo *root,
+								 Relids leftrelids,
+								 Relids outerrelids)
 {
 	List	   *result;
-	Relids		leftrelids = leftpath->parent->relids;
-	Relids		outerrelids = PATH_REQ_OUTER(leftpath);
 	Relids		allleftrelids;
 	ListCell   *cell;
 
@@ -661,25 +654,58 @@ identify_current_nestloop_params(PlannerInfo *root, Path *leftpath)
 			bms_is_member(nlp->paramval->varno, leftrelids))
 		{
 			Var		   *var = (Var *) nlp->paramval;
+			RelOptInfo *rel = root->simple_rel_array[var->varno];
 
 			root->curOuterParams = foreach_delete_current(root->curOuterParams,
 														  cell);
-			var->varnullingrels = bms_intersect(var->varnullingrels,
+			var->varnullingrels = bms_intersect(rel->nulling_relids,
 												leftrelids);
 			result = lappend(result, nlp);
 		}
 		else if (IsA(nlp->paramval, PlaceHolderVar))
 		{
 			PlaceHolderVar *phv = (PlaceHolderVar *) nlp->paramval;
-			Relids		eval_at = find_placeholder_info(root, phv)->ph_eval_at;
+			PlaceHolderInfo *phinfo = find_placeholder_info(root, phv);
+			Relids		eval_at = phinfo->ph_eval_at;
 
 			if (bms_is_subset(eval_at, allleftrelids) &&
 				bms_overlap(eval_at, leftrelids))
 			{
 				root->curOuterParams = foreach_delete_current(root->curOuterParams,
 															  cell);
-				phv->phnullingrels = bms_intersect(phv->phnullingrels,
-												   leftrelids);
+
+				/*
+				 * Deal with an edge case: if the PHV was pulled up out of a
+				 * subquery and it contains a subquery that was originally
+				 * pushed down from this query level, then that will still be
+				 * represented as a SubLink, because SS_process_sublinks won't
+				 * recurse into outer PHVs, so it didn't get transformed
+				 * during expression preprocessing in the subquery.  We need a
+				 * version of the PHV that has a SubPlan, which we can get
+				 * from the current query level's placeholder_list.  This is
+				 * quite grotty of course, but dealing with it earlier in the
+				 * handling of subplan params would be just as grotty, and it
+				 * might end up being a waste of cycles if we don't decide to
+				 * treat the PHV as a NestLoopParam.  (Perhaps that whole
+				 * mechanism should be redesigned someday, but today is not
+				 * that day.)
+				 */
+				if (root->parse->hasSubLinks)
+				{
+					phv = copyObject(phinfo->ph_var);
+
+					/*
+					 * The ph_var will have empty nullingrels, but that
+					 * doesn't matter since we're about to overwrite
+					 * phv->phnullingrels.  Other fields should be OK already.
+					 */
+					nlp->paramval = (Var *) phv;
+				}
+
+				phv->phnullingrels =
+					bms_intersect(get_placeholder_nulling_relids(root, phinfo),
+								  leftrelids);
+
 				result = lappend(result, nlp);
 			}
 		}
diff --git a/src/backend/optimizer/util/placeholder.c b/src/backend/optimizer/util/placeholder.c
index 41a4c81e94a..e1cd00a72fb 100644
--- a/src/backend/optimizer/util/placeholder.c
+++ b/src/backend/optimizer/util/placeholder.c
@@ -545,3 +545,43 @@ contain_placeholder_references_walker(Node *node,
 	return expression_tree_walker(node, contain_placeholder_references_walker,
 								  context);
 }
+
+/*
+ * Compute the set of outer-join relids that can null a placeholder.
+ *
+ * This is analogous to RelOptInfo.nulling_relids for Vars, but we compute it
+ * on-the-fly rather than saving it somewhere.  Currently the value is needed
+ * at most once per query, so there's little value in doing otherwise.  If it
+ * ever gains more widespread use, perhaps we should cache the result in
+ * PlaceHolderInfo.
+ */
+Relids
+get_placeholder_nulling_relids(PlannerInfo *root, PlaceHolderInfo *phinfo)
+{
+	Relids		result = NULL;
+	int			relid = -1;
+
+	/*
+	 * Form the union of all potential nulling OJs for each baserel included
+	 * in ph_eval_at.
+	 */
+	while ((relid = bms_next_member(phinfo->ph_eval_at, relid)) > 0)
+	{
+		RelOptInfo *rel = root->simple_rel_array[relid];
+
+		/* ignore the RTE_GROUP RTE */
+		if (relid == root->group_rtindex)
+			continue;
+
+		if (rel == NULL)		/* must be an outer join */
+		{
+			Assert(bms_is_member(relid, root->outer_join_rels));
+			continue;
+		}
+		result = bms_add_members(result, rel->nulling_relids);
+	}
+
+	/* Now remove any OJs already included in ph_eval_at, and we're done. */
+	result = bms_del_members(result, phinfo->ph_eval_at);
+	return result;
+}
diff --git a/src/include/optimizer/paramassign.h b/src/include/optimizer/paramassign.h
index d30d20de299..bbf7214289b 100644
--- a/src/include/optimizer/paramassign.h
+++ b/src/include/optimizer/paramassign.h
@@ -30,7 +30,8 @@ extern Param *replace_nestloop_param_placeholdervar(PlannerInfo *root,
 extern void process_subquery_nestloop_params(PlannerInfo *root,
 											 List *subplan_params);
 extern List *identify_current_nestloop_params(PlannerInfo *root,
-											  Path *leftpath);
+											  Relids leftrelids,
+											  Relids outerrelids);
 extern Param *generate_new_exec_param(PlannerInfo *root, Oid paramtype,
 									  int32 paramtypmod, Oid paramcollation);
 extern int	assign_special_exec_param(PlannerInfo *root);
diff --git a/src/include/optimizer/placeholder.h b/src/include/optimizer/placeholder.h
index d351045e2e0..db92d8861ba 100644
--- a/src/include/optimizer/placeholder.h
+++ b/src/include/optimizer/placeholder.h
@@ -30,5 +30,7 @@ extern void add_placeholders_to_joinrel(PlannerInfo *root, RelOptInfo *joinrel,
 										SpecialJoinInfo *sjinfo);
 extern bool contain_placeholder_references_to(PlannerInfo *root, Node *clause,
 											  int relid);
+extern Relids get_placeholder_nulling_relids(PlannerInfo *root,
+											 PlaceHolderInfo *phinfo);
 
 #endif							/* PLACEHOLDER_H */
diff --git a/src/test/regress/expected/join.out b/src/test/regress/expected/join.out
index c292f04fdba..390aabfb34b 100644
--- a/src/test/regress/expected/join.out
+++ b/src/test/regress/expected/join.out
@@ -4119,6 +4119,164 @@ select * from int8_tbl t1
 (16 rows)
 
 rollback;
+-- ... not that the initial replacement didn't have some bugs too
+begin;
+create temp table t(i int primary key);
+explain (verbose, costs off)
+select * from t t1
+    left join (select 1 as x, * from t t2(i2)) t2ss on t1.i = t2ss.i2
+    left join t t3(i3) on false
+    left join t t4(i4) on t4.i4 > t2ss.x;
+                        QUERY PLAN                        
+----------------------------------------------------------
+ Nested Loop Left Join
+   Output: t1.i, (1), t2.i2, i3, t4.i4
+   ->  Nested Loop Left Join
+         Output: t1.i, t2.i2, (1), i3
+         Join Filter: false
+         ->  Hash Left Join
+               Output: t1.i, t2.i2, (1)
+               Inner Unique: true
+               Hash Cond: (t1.i = t2.i2)
+               ->  Seq Scan on pg_temp.t t1
+                     Output: t1.i
+               ->  Hash
+                     Output: t2.i2, (1)
+                     ->  Seq Scan on pg_temp.t t2
+                           Output: t2.i2, 1
+         ->  Result
+               Output: i3
+               One-Time Filter: false
+   ->  Memoize
+         Output: t4.i4
+         Cache Key: (1)
+         Cache Mode: binary
+         ->  Index Only Scan using t_pkey on pg_temp.t t4
+               Output: t4.i4
+               Index Cond: (t4.i4 > (1))
+(25 rows)
+
+explain (verbose, costs off)
+select * from
+     (select k from
+         (select i, coalesce(i, j) as k from
+             (select i from t union all select 0)
+             join (select 1 as j limit 1) on i = j)
+         right join (select 2 as x) on true
+         join (select 3 as y) on i is not null
+     ),
+     lateral (select k as kl limit 1);
+                            QUERY PLAN                             
+-------------------------------------------------------------------
+ Nested Loop
+   Output: COALESCE(t.i, (1)), ((COALESCE(t.i, (1))))
+   ->  Limit
+         Output: 1
+         ->  Result
+               Output: 1
+   ->  Nested Loop
+         Output: t.i, ((COALESCE(t.i, (1))))
+         ->  Result
+               Output: t.i, COALESCE(t.i, (1))
+               ->  Append
+                     ->  Index Only Scan using t_pkey on pg_temp.t
+                           Output: t.i
+                           Index Cond: (t.i = (1))
+                     ->  Result
+                           Output: 0
+                           One-Time Filter: ((1) = 0)
+         ->  Limit
+               Output: ((COALESCE(t.i, (1))))
+               ->  Result
+                     Output: (COALESCE(t.i, (1)))
+(21 rows)
+
+rollback;
+-- PHVs containing SubLinks are quite tricky to get right
+explain (verbose, costs off)
+select *
+from int8_tbl i8
+  inner join
+    (select (select true) as x
+       from int4_tbl i4, lateral (select i4.f1 as y limit 1) ss1
+       where i4.f1 = 0) ss2 on true
+  right join (select false as z) ss3 on true,
+  lateral (select i8.q2 as q2l where x limit 1) ss4
+where i8.q2 = 123;
+                           QUERY PLAN                           
+----------------------------------------------------------------
+ Nested Loop
+   Output: i8.q1, i8.q2, (InitPlan 1).col1, false, (i8.q2)
+   InitPlan 1
+     ->  Result
+           Output: true
+   InitPlan 2
+     ->  Result
+           Output: true
+   ->  Seq Scan on public.int4_tbl i4
+         Output: i4.f1
+         Filter: (i4.f1 = 0)
+   ->  Nested Loop
+         Output: i8.q1, i8.q2, (i8.q2)
+         ->  Subquery Scan on ss1
+               Output: ss1.y, (InitPlan 1).col1
+               ->  Limit
+                     Output: NULL::integer
+                     ->  Result
+                           Output: NULL::integer
+         ->  Nested Loop
+               Output: i8.q1, i8.q2, (i8.q2)
+               ->  Seq Scan on public.int8_tbl i8
+                     Output: i8.q1, i8.q2
+                     Filter: (i8.q2 = 123)
+               ->  Limit
+                     Output: (i8.q2)
+                     ->  Result
+                           Output: i8.q2
+                           One-Time Filter: ((InitPlan 1).col1)
+(29 rows)
+
+explain (verbose, costs off)
+select *
+from int8_tbl i8
+  inner join
+    (select (select true) as x
+       from int4_tbl i4, lateral (select 1 as y limit 1) ss1
+       where i4.f1 = 0) ss2 on true
+  right join (select false as z) ss3 on true,
+  lateral (select i8.q2 as q2l where x limit 1) ss4
+where i8.q2 = 123;
+                           QUERY PLAN                           
+----------------------------------------------------------------
+ Nested Loop
+   Output: i8.q1, i8.q2, (InitPlan 1).col1, false, (i8.q2)
+   InitPlan 1
+     ->  Result
+           Output: true
+   InitPlan 2
+     ->  Result
+           Output: true
+   ->  Limit
+         Output: NULL::integer
+         ->  Result
+               Output: NULL::integer
+   ->  Nested Loop
+         Output: i8.q1, i8.q2, (i8.q2)
+         ->  Seq Scan on public.int4_tbl i4
+               Output: i4.f1, (InitPlan 1).col1
+               Filter: (i4.f1 = 0)
+         ->  Nested Loop
+               Output: i8.q1, i8.q2, (i8.q2)
+               ->  Seq Scan on public.int8_tbl i8
+                     Output: i8.q1, i8.q2
+                     Filter: (i8.q2 = 123)
+               ->  Limit
+                     Output: (i8.q2)
+                     ->  Result
+                           Output: i8.q2
+                           One-Time Filter: ((InitPlan 1).col1)
+(27 rows)
+
 -- Test proper handling of appendrel PHVs during useless-RTE removal
 explain (costs off)
 select * from
diff --git a/src/test/regress/sql/join.sql b/src/test/regress/sql/join.sql
index 88d2204e447..f6e7070db65 100644
--- a/src/test/regress/sql/join.sql
+++ b/src/test/regress/sql/join.sql
@@ -1361,6 +1361,52 @@ select * from int8_tbl t1
   on true;
 rollback;
 
+-- ... not that the initial replacement didn't have some bugs too
+begin;
+create temp table t(i int primary key);
+
+explain (verbose, costs off)
+select * from t t1
+    left join (select 1 as x, * from t t2(i2)) t2ss on t1.i = t2ss.i2
+    left join t t3(i3) on false
+    left join t t4(i4) on t4.i4 > t2ss.x;
+
+explain (verbose, costs off)
+select * from
+     (select k from
+         (select i, coalesce(i, j) as k from
+             (select i from t union all select 0)
+             join (select 1 as j limit 1) on i = j)
+         right join (select 2 as x) on true
+         join (select 3 as y) on i is not null
+     ),
+     lateral (select k as kl limit 1);
+
+rollback;
+
+-- PHVs containing SubLinks are quite tricky to get right
+explain (verbose, costs off)
+select *
+from int8_tbl i8
+  inner join
+    (select (select true) as x
+       from int4_tbl i4, lateral (select i4.f1 as y limit 1) ss1
+       where i4.f1 = 0) ss2 on true
+  right join (select false as z) ss3 on true,
+  lateral (select i8.q2 as q2l where x limit 1) ss4
+where i8.q2 = 123;
+
+explain (verbose, costs off)
+select *
+from int8_tbl i8
+  inner join
+    (select (select true) as x
+       from int4_tbl i4, lateral (select 1 as y limit 1) ss1
+       where i4.f1 = 0) ss2 on true
+  right join (select false as z) ss3 on true,
+  lateral (select i8.q2 as q2l where x limit 1) ss4
+where i8.q2 = 123;
+
 -- Test proper handling of appendrel PHVs during useless-RTE removal
 explain (costs off)
 select * from
