Following a hallowed seasonal tradition next week, like countless other families, some time between the end of Christmas lunch and the beginning of the first James Bond film, we will haul out the Monopoly board. As usual, I will get to choose my piece last, and end up as the boot.

After about an hour of enjoyable imaginary capitalism, someone will cheat. Granny will go spectacularly bankrupt. Then someone will extract an exorbitant rent from a sibling with slightly too much relish, and there will be a tremendous row. Then the game will be abandoned.

Much later, when everyone else has gone to bed and I am padding around barefoot, turning out the lights, I will step on the board, painfully embedding a small red plastic hotel in my foot.

Monopoly is the most interesting and revealing board game in the world. It is not the most challenging, and certainly not the most skilful, but no game says more about us, for good and ill, and no game has more closely echoed our changing relationship with money over the past century.

Like capitalism itself, Monopoly inspires both greed and opportunity. Unlike any other game, its appeal is almost universal. Some 750 million people have played the game at least once. Where the origins of most traditional board games are lost in time, modern Monopoly adheres to a single defining idea, in an intensely social game, as well as a tactical tussle. It involves “play” in two senses: like a sport, it is played to win, but it is also play as a theatrical event, where the individual players perform their allotted roles according to character.

Monopoly is about acquisition and rivalry, but also ambition and optimism. It offers the lesson that luck plays a crucial part in any moneymaking system: you may amass great wealth, but you may also go directly to jail. No matter how often one loses, every player sets off from Go expecting to win. “Monopoly can inspire hope in anyone who plays it,” writes Philip E. Orbanes, author of a history of the game. “Monopoly is the first economic teacher suggesting that a richer life is available if one is willing to reach for it.”

But the most extraordinary thing about Monopoly is the way it has mirrored, and evolved alongside, the economic history of the 20th century. Monopoly began life as an anti-capitalist statement. In 1903 an American Quaker named Lizzie Magie invented The Landlord's Game. This was less an entertainment than a polemic, a direct attack on property speculation and rent gouging intended to promote the campaign by the American political economist Henry George for a single tax on land and landlords.

Charles Darrow, an American heating engineer who had lost his job in the crash of 1929, then radically adapted the game, turning a critique of landlordism into a celebration of wheeling and dealing in property.

Monopoly, patented in 1935, proved an immediate hit, offering a fantasy world of easy money in Depression-era America. The game spread around the world, swiftly becoming part of the economic, cultural and political landscape. Hitler Youth thugs attacked shops stocking the German version of the game, which the Nazis regarded as dangerous and decadent. Mussolini tolerated the renamed Monopoli, but only after the street names had been altered to pay homage to Italian Fascism.

In 1941 the British Secret Service approached Waddingtons, the game's British manufacturer, and arranged to create some “special” sets of Monopoly for distribution to PoWs via the Red Cross. Alongside all the traditional elements were others, to help the prisoners get out of jail free: a metal file, a magnetic compass, and an escape map marked with safe houses, printed on silk and sewn into the board. Hidden among the Monopoly money was genuine local currency. The special boards were marked with a small red dot in the corner of Free Parking.

Monopoly, with its unfettered free-market ethos, was banned behind the Iron Curtain, yet sets still circulated underground. Communist leaders invented their own Marxist-Leninist versions, with names like “Save” and “Manage”. They did not catch on.

Today's Monopoly is still a mirror. Instead of paper money, the latest “Here and Now” versions involve electronic banking, enabling players to rack up huge debts on credit cards. Where properties once changed hands for a few pounds, they now sell for millions. These days Community Chest can jail you for identity theft, or offer millions for appearing on reality television. The humble Scottie dog and iron have been replaced by a mobile phone and a designer handbag.

We now have editions dedicated to The Lord of the Rings, The Simpsons, and Elvis. There is even Ghettopoly, a sort of gangland version in which “da object is to become da richest playa through stealing, cheating and fencing stolen properties”.

Now that the economy is cooling, and the property boom slowing, Monopoly will surely follow: Northern Rock where Old Kent Road used to be, and sub-prime mortgages in the Chance pile? A credit card with a strict borrowing limit? Monopoly may even return a little closer to Magie's finger-wagging original, a warning that property investments can go down, as well as up.

But in essence Monopoly will still be the same: it will still reflect the pleasure and pitfalls of speculation, our complex relationship with capitalism, and it will still arouse greed, rage and enjoyment in equal measure. And on Boxing Day there will still be the perfect imprint of a plastic hotel in the sole of my foot.

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