This is a good question. There are some stages during where the project manager needs to be minimally involved, while there are stages during which the project manager has to be heavily involved.
During the forming stage: The project manager forms the project team and show watch them from a distance how they study each other, his involvement should be limited to clarifying misconceptions about other members.
During the storming stage: This stage is full of conflicts, and the project manager needs to be heavily involved to resolve these conflicts. Lack of involvement from the project manager's side may lead to a dysfunctional team that will always remain in this stage. The Project Manager has to make peace with team members, and has to ensure that conflicts don't fester.
During the norming stage: Now team members work together with near-harmony. During this stage, the project manager's involvement is limited to stopping some team members from imposing their thoughts on other (weaker) team members.
During the performing stage: The project manager is not involved at all (from the team development perspective) as the team is working perfectly at this stage.