Shared Hosting is typically cheaper than Dedicated Hosting.
Because you're sharing the web servier with others, shared hosting could be slower in performance.
Dedicated Hosting is that you lease the rack server entirely for yourself - allowing you to create an almost unlimitless number of web sites. Plus, you get SecureShell access (for linux servers) so that you can pretty much full configuration.
If you are planning on creating many web sites (doesn't matter if they are small or big), then dedicated is the way to go. It's fairly cheap now.
The Consumer's Guide to Home Technologies