The mall scene may not be a hotbed of high-octane growth, but that didn't prevent operator Simon Property Group (NYSE:SPG) from hiking its dividend this past week.

Structured as a REIT -- or Real Estate Investment Trust -- Simon looks to grow its funds from operations in order to boost quarterly payouts to investors. Many mall companies like Mills (NYSE:MLS) are structured this way.

Over the last three years, Simon's quarterly payouts per share have grown from $0.505 to $0.65. That's something you won't find in a fixed-rate government or corporate bond. Sure, you have greater risks in buying into equities. There is no maturity date or lofty par value. Debt-holders will usually stand in line in front of shareowners to salvage what's left if the company goes under.

However, with the improving economy, buying into high-yielding stocks is a tempting strategy. As earnings grow, so grows the flexibility to hike dividends. While a traditional bond will have a fixed payout and usually fall in value as interest rates rise, growing companies can afford to put out competitive yields without giving up on capital appreciation.

Last year, we launched our Income Investor newsletter to unearth some promising income-producing securities. Singling out just the right dividend-paying stocks can give your portfolio stability in any interest rate environment.

As Simon illustrates, companies that grow their dividends are worth watching. Look around and you'll find others. Last week global insurance broker Willis Group (NYSE:WSH) also raised its dividend. It's the second time that the company has increased its distributions since initiating quarterly payouts last year.

Clearly, utilities and financial stocks that offer dividends are in fashion, given their tax-advantaged spin. Even Microsoft (NASDAQ:MSFT) recently started to put out; in fact, Standard & Poor's reports that 1,630 companies either initiated dividends or hiked their existing payouts last year. It's a growing field of growing dividends. It pays to pay attention.

Do dividends matter to you? Even if they don't, do you see higher dividends as an indicator of an improving company or a failure to invest? What about convertible bonds? Are growth and income mutual funds bogus? All this and more -- in the Investing for Income discussion board. Only on Fool.com.