Difference between steady state value and Long term value

Hello
Assalamu Alaikum
Apologies for a very simple question.
Can I consider the long term average of GDP as steady state value? Or should I go for the model specific steady state value? Like find the steady state of an equation and then calculate it through # sign.

That depends on the context. But GDP is trending upwards. So the long-term average does not exist and therefore cannot be used. In contrast, using ratios often works.

What about using the FMOLS cointegration for prior from the data?
For example if I want to have steady state capital to net-worth (K/N) ratio, can I use the FMOLS for that?
Should I go for K as dependent and Net-worth as independent? Or the opposite?

Again, for a ratio, this should be fine. What do you mean with dependent/independent?

If one tries to find the data based value of prior, can the cointegration be used? If so, for example for K/N, should K (capital) be a dependent variable and Net-worth be an independent? Or vice versa?

  1. A prior must not be based on the data sample.
  2. If you are just interested in the ratio, you could simply use the average ratio. If you want to estimate cointegration, then K and N would both be endogenous in the vector error correction model.