Sensitivity.
This is a measure of how much electrical output is produced by a given sound. This is a vital specification if you are trying to record very tiny sounds, such as a turtle snapping its jaw, but should be considered in any situation. If you put an insensitive mic on a quiet instrument, such as an acoustic guitar, you will have to increase the gain of the mixing console, adding noise to the mix. On the other hand, a very sensitive mic on vocals might overload the input electronics of the mixer or tape deck, producing distortion.
Overload characteristics.
Any microphone will produce distortion when it is overdriven by loud sounds. This is caused by varous factors. With a dymanic, the coil may be pulled out of the magnetic field; in a condenser, the internal amplifier might clip. Sustained overdriving or extremely loud sounds can permanently distort the diaphragm, degrading performance at ordinary sound levels. Loud sounds are encountered more often than you might think, especially if you place the mic very close to instruments. (Would you put your ear in the bell of a trumpet?) You usually get a choice between high sensitivity and high overload points, although occasionally there is a switch on the microphone for different situations.
Linearity, or Distortion.
This is the feature that runs up the price of microphones. The distortion characteristics of a mic are determined mostly by the care with which the diaphragm is made and mounted. High volume production methods can turn out an adequate microphone, but the distortion performance will be a matter of luck. Many manufacturers have several model numbers for what is essentially the same device. They build a batch, and then test the mics and charge a premium price for the good ones. The really big names throw away mic capsules that don't meet their standards. (If you buy one Neumann mic, you are paying for five!) CIAO xxx