its adjusted by the idle adjustment screw, should rest on stop, looks like yours is all the way in, . do you have high idle?
you say at start rpm's go high, just to be clear, not a run away rpm, try backing out that idle screw,,if no help can always put it back, should idle on muffs about 1100 to 1300 or so, if no help , what racerone said
You adjust it for idle when its warm and in a barrel or in the sea/lake/river/ swimming pool whatever (it needs back pressure on it)
In neutral make sure its up to operating temperature (by using the warm up lever) when its reaches temperature screw the idle screw on the throttle arm ( the silver one below the one in your picture) in slowly until the motor dies. Then back it out a touch. You want it at the lowest setting that the motor will run on when warm, there is no spec per se.
You will find that that idle screw is a lot further in so long as everything else on your motor is generally alright. Your wot one looks out of whack too so if that is where you are getting the timing flash for the spec for this motor then you will need to check the flywheel key. You can do that by moving the motor to TDC and checking that the flywheel is at 0degs if you dont want to pull it