Volcarona is far better in terms of stats, but Arcanine works well as a mixed attacker too (and he learns Extremespeed). It depends what you need...
Volcarona;
Quiver Dance
Flame Dance
Bug Buzz
Anything / Hurricane
Arcanine;
Extremespeed
Flare Blitz
Anything (from what I understand, he learns Morning Sun, Dragon Pulse, Will-o-Wisp, Wild Charge, Aerial Ace, Iron Head, Close Combat, Crunch, etc.)
Volcarona is overwhelming as a Special Attacker, but Arcanine fills many roles...
Though, there's not a problem with having two Fire-types :|