In the case of Pixar films it could be a mixed bag. For instance I would say that toy story 2 was just as good as the original and toy story 3 ranks pretty high as well. On the other hand cars 2 sounded like an excuse to make money off another mediocre story with crappy characters.

Making a sequel can mean that less time goes into the development of a whole new world and characters, and character motivations. This could leave more time devoted to a better story with interesting character arcs, cooler tricks of animation and the like. Since Monsters Inc. was a good movie with interesting characters and a good story, it might have a fighting chance as another great sequel, or prequel in this case.