If you are connecting through .Net:
Provider=IBMDA400;Data Source=as400.com;User Id=user;Password=password;Default Collection=yourLibrary;
Default Collection is the parameter that sets the library where your programs should start executing.
And if you are connecting through ODBC from windows (like setting up a driver in the control panel):
DRIVER=Client Access ODBC Driver(32-bit);SYSTEM=as400.com;EXTCOLINFO=1;UID=user;PWD=password;LibraryList=yourLibrary
In this case LibraryList is the parameter to set, remember this is for ODBC connection.
There are two drivers from IBM to connect to the AS400, the older one uses the above connection string, if you have the newest version of the client software from IBM called "System i Access for windows" then you should use this connection string:
DRIVER=iSeries Access ODBC Driver;SYSTEM=as400.com;EXTCOLINFO=1;UID=user;PWD=password;LibraryList=yourLibrary
The last is pretty much the same, only the DRIVER parameter value changes
If you are using this in a .Net application dont forget to add the providerName parameter to your XML tag and define the API used for connecting which would be OleDb in this case:
providerName="System.Data.OleDb"