Peter wrote:The practice I am familiar with is to dedicate merit. Do something meritorious and then say "If my loved one is in a position to rejoice in these merits may they do so, may they be reborn into favorable circumstances, and may they attain Nibbana." The theory is if a loved one was born into the ghost realm, they might be hanging around their loved ones. Rejoicing in another's meritorious act is itself meritorious and might help them take birth in a better realm than ghost. So you are essentially calling the ghost's attention to the act, giving them a chance to rejoice in it and make merit of their own.
That's one of the best summaries of the Theravada view on transfer of merit that I've heard. As far as I am aware there's no Theravada teaching that metta meditation directly
affects the "object" of metta. (Of course, there are many indirect
benefits when you are less angry with a person because you've been focussing metta on them, or less aggrieved about a loss.)