Michael Scott is funnier than Dwight Schrute because he makes lame jokes that are really not funny, but the sheer absurdity of his persona and the way he acts is hilarious. Dwight is funny in his own right, but less funny because he takes himself too seriously and doesn't crack as many jokes as Michael.
Michael Scott's humor is forced; it takes the shotgun approach of slapstick comedy that at some point will probably make you laugh. But Dwight Schrute's humor is more intelligent and witty. There's usually a reason behind all of the Dwight Schrute humor, which isn't necessarily true for Michael Scott's random stupid humor.