It's very hard as a single player to beat a credit union. So the winning player will want to build some sort of alliance with at least some of the losers to make their coalition weaker, which will pull those players up the ladder and give them a chance, and so on. It creates a mostly good dynamic of cooperation for self-preservation.
In the end, one person wins, but it's often a close race.
(This works best if you play with the same crowd every time, because then people have reason to build trust with each other and won't suddenly default on a huge loan without feeling the consequences of it.)
The game seems to have earned a bad reputation, the prototype for the sort of game you shouldn't play anymore because everything from the last 25 years is better. I'm not sure this is deserved, but realistically my copy will probably end up collecting dust. After reading your comment, I hope not!
IIRC, you don’t need house rules for that, so long as “arbitrary contracts” covers future commitments for things otherwise legal to exchange (you do need house rules for such contracts to be self-enforcing, though.)
I remember playing a 3-player game of Root (which I highly recommend!) Player A ambushed me and managed to burn down my headquarters. At that point I realized I couldn't win, and I spent the rest of the game attacking A.
A complained that I was just throwing the game to B, which is exactly what happened. The kingmaker problem made A's decision into a huge blunder. If you don't pay attention to psychology in these games, you will lose.
There tend to be three kinds of kingmaking: revenge, social dynamics, and wanting to leave. All of them have something in common: they are done for reasons outside the gamespace. They're violating the boundaries of the game.
Revenge (what you did) is out-of-bounds because it's using the game to win future games rather than playing the current one.
Social dynamics and wanting to leave are out-of-bounds because they're using the game for rewards that have nothing to do with the game.
No, its not.
It is, of course, more desirable from the perspective of people who prefer that style of play that others conform to it, but it is in no way “essential”.
It may be beneficial to mutual enjoyment to have table agreement on metagame issues like this in advance (OTOH, one might do well to recognise the inherent incentive structure toward the metagame approach you decry in games which tend to produce a long, lingering defeat with no reasonable route to victory.)
I wasn't angry at my friend, and I wasn't personally seeking revenge. I was role-playing my cat army, which suddenly had its home city burned down. My cats certainly were seeking revenge.
In real life, facing an enemy who has nothing to lose can be highly dangerous, and creating such a situation is foolhardy. Why should a board game be different? Why play for second, when a more appealing alternate goal suggested itself?
Munchkin takes this to the extreme, where someone will perpetually be on the edge of winning and there are a variety of colorful ways to set them back. It's random and chaotic by design.
Monopoly doesn't really involve such a mechanic. You can refuse to trade with someone who is pulling ahead, but by that time it is more likely to be too late.